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Real-Money Stock Picks / Messed-Up Expectations Portfolio


Subject:  Re: RST? Date:  3/16/2011  8:30 AM
Author:  TMFGebinr Number:  278 of 1287

But if I had confidence, I'd be saying that this is a good time to buy. So, for now at least, I'm holding and watching to see how this management team responds.

Hi Dave,

I think that's a good summary of how I feel, as well.

The two riskiest positions I have in the MUE port are GameStop and Supervalu. And you might arguably put Dean Foods on that list, as well. Supervalu is in turnaround mode, but it's not clear if it will make it. GameStop is hurting on margins and needs to get those under control and back up. Dean Foods is being hurt by grocery stores and higher milk costs, getting its margins squeezed from both sides.

In each of these, though, (except possibly for GameStop), management's outlined a clear plan on what to do to fix things and seem to be executing on it. It will take a bit of time for the plan to work out and it could still fail, but there's a path to follow.

For Rosetta Stone, I don't see that plan quite yet. And I'm not sure management does, either. The price is indeed a bargain if it can turn things around and fulfill David G's vision for the company. I just can't quite get there at the moment, however.

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