Bud's Poem Page
  Katie's Route 66 Blog
  Katie's Coast2Coast Blog
  Katie's West Coast Blog
  Katie's East Coast Blog
Lemley Yarling Management Co
309 W Johnson Street
Apt 544
Madison, WI 53703
Bud: 312-925-5248

Comments on activity in client accounts

26 July 2019

Markets tripped higher during the week as a mixed bag of earnings reports affected individual stocks. Google jumped on better than, Tesla dropped after it reported record sales but lost $400 million on those sales. Oops, so much for the profitability that was promised going forward.

We've been using earnings disappointments to revise our portfolios with cash and by selling part of our larger holdings in United Natural Foods (flat if the profit earlier this year is included to offset the loss on this trade) and Abercrombie.

To maintain our large cash position and to improve quality we sold Box, Marathon (Apache has a 4% yield and moves the same percent as Marathon both up and down), and Bed Bath (for purchase at year end and at a loss on this trade but flat for the year on the profit realized in January).

We purchased Wells Fargo (4% yield, 10 x earnings, and looking for a CEO) which is universally hated; Intel which is consider to be losing the premium chip battle to Nvidia and AMD; Bristol Myers (see below); British Petroleum which yields 6%; Apache which yields 4%; and Kroger on a 7-year low and yielding 3%.

We added to AT&T when the street viewed the earnings' news as positive even though Direct TV lost more subscribers than expected; and we repurchased Ford when it dropped 8% on earnings.

We currently own- and will for a while-

AT&T (6% yield); United Natural Foods (down 70% from last year's high and priced at 5X earnings); Sprouts Food Markets down 25% from the price at which we profitably sold earlier this year; Kroger valued at what Amazon paid for Whole Foods with 2500 stores vs 500 for Whole Foods. If Amazon wanted to get into the grocery business it should have purchased Kroger. Abercrombie (4%); Walgreens Boots 3% and 10X; Bristol Myers on a six-year low and yielding 3.5% and 10X when all the other large drug companies are priced at 15x and more; Wintrust; Wells Fargo; Intel; Apache; British Petroleum; and Ford 6% 7X.

And time moves on.




Only in America:


Bristol Myers:



Boeing and the Max:


Goldman says the bull is dying:





21 July 2019

Markets continue to mark time as they await a Fed rate cut that isn't needed. July 31 is the target date.

New and recently issued stocks (IPOs) continue to hog the news as they double and triple- and more- in price after their initial offerings. We ae struck by the talking heads mention of these companies and other more mature companies as must own with no mention of p/e ratios, dividend yield or debt ratios. Been there (1972,1987,2000,2008); seen that.

Meanwhile our value issues wallow in the unloved column of the daily market reports. Such is the life of value investors in these markets.

We added Wintrust Financial, the Chicago banking conglomerate after it dropped 10% this week on less than but still positive earnings. We repurchased Apache Oil and also picked up shares of the XOP the Domestic Oil ETF as both made new multi-year lows this week. We know electric cars are here to stay as is solar and wind power but we are not ready to predict the end of fossil fuel consumption in the near future.

We currently own AT&T, Abercrombie, Apache Oil, Bed Bath, Bristol Myers, Box, Marathon Oil., Sprouts Food Markets, United Natural Foods, Walgreen Boots, Wintrust Financial and XOP.

Ans so, it goes


America's bottom 50% are slowly recovering from the Great Recession



12 July 2019

During the week we added Sprouts at $18.80 to accounts in which we sold at $23 plus in May.

We also repurchased Walgreens Boots in our tax-free accounts when it moved up a bit on news that the Govt is not going to place controls on Pharmacy Benefit Managers rebate programs with drug companies. That's a good positive for the PBMs but bad news for those who buy drugs. We have been uncomfortable not owning some WBA. We will repurchase WBA in taxable accounts when the 31-day wash sale period expires.

Finally, we repurchased Bristol Myers at a new 6 year low.

Some Gurus are not enamored of the Celgene takeover and also there is an arbitrage situation which may hold the stock down until year end. But we do think there is at least a trading opportunity from this level.

To keep cash levels high, we eliminated The Gap for a scratch to concentrate on Abercrombie as our retail exposure.

With the Trumpster holding his own and expectations of a Fed rate cut next week the markets continue to make new highs.

And so, it goes.


Bed Bath earnings were blah, as is this review. The good and the bad:


Sprouts vs. Whole Foods https://www.grocerydive.com/news/sprouts-is-holding-its-own-against-whole-foods/533672/


5 July 2019

Markets await the Fed meeting in July to see whether it will cut interest rates. Supposedly everything is fine with over 200,000 jobs added in June but the mavens want a rate cut and if they don't get it----. The lunatics are managing the asylum.

Awaiting the June employment number this morning of the 1980s reminds (we written this before) when the monthly balance of payments report was the vehicle that traders look for in the olden days (1980s) to move markets. Now there is a report every 5 minutes and there are also the Trumpster tweets, and China, and Europe and soon Boris Johnson in England to help traders' computers move stocks.

We added to Wisdom Tree- which is yielding more than the 10-year treasury (inverted yield curve signals recession) this week and also picked up a relatively small amount of Bed Bath and Beyond which is price at $1.3 billion with $12 billion in sales and debt equaling cash on hand. We traded BBB at year end for a 10% profit. We are looking for more this time with a longer holding horizon unless it pops on earrings next week as it did last quarter.

And so, it goes.

This Market Indicator Has Predicted the Past 7 Recessions




Comments on activity archives



This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner.

Website Information

Check the background of this firm at https://brokercheck.finra.org/

For Information on RBC LLC SIPC and Excess SIPC protection https://www.rbcwm-usa.com/legal/rbc-cs/cid-319579.html.

For those clients of LY & Co and other interested persons the Quarterly Report on the routing of customer orders under SEC Rule11Ac1-6.
For Quarter Ending 09/30/2002 For Quarter Ending 12/31/2002 For Quarter Ending 03/31/2003
For Quarter Ending 06/30/2003 For Quarter Ending 09/30/2003 For Quarter Ending 12/31/2003
For Quarter Ending 03/31/2004

All SEC Rule11Ac1-6 Quarterly reports up to March 2, 2012 may be found by visiting the diclosures at LY& Co Clearing Broker Mesirow Financial at: http://www.tta.thomson.com/reports/1-6/msro/.

From March 2, 2012 forward all SEC Rule11Ac1-6 Quarterly reports may be found by visiting the website https://www.rbcwm-usa.com/legal/rbc-cs/cid-360855.html.

Annual offer to present clients of Lemley Yarling Management Co. Under Rule 204-3 of the SEC Advisors Act, we are pleased to offer to send to you our updated Form ADV, Part II for your perusal. If any present client would like a copy, please don't hesitate to write, e-mail, or call us.

A list of all recommendations made by Lemley Yarling Management Co for the preceding one-year period is available upon request.

Business Continuity Plan


309 W Johnson Street Apt 544 Madison, WI 53703 312-925-5248
The factual statements herein have been taken from sources we believe to be reliable but such statements are made without any representation as to accuracy or completeness or otherwise. From time to time the Lemley Letter, or one or more of its officers or employees, may buy and sell as agent the securities referred to herein or options relating thereto, and may have a long or short position in such securities or options. This report should not be construed as a solicitation or offer of the purchase or sale of securities. Prices shown are approximate. Past performance is no indication of future performance.