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Subject:  Re: TXT - love a thesis that's working Date:  6/24/2011  8:21 AM
Author:  aitraders Number:  396 of 1287

I like Textron. I did a report on them in HS. I like their diversification with some military. I bought them for my CAPS portfolio to track them. At this price, I probably will wish that I had bought some shares because Cessna will come back, of that I have no doubt. and I like the fact that Textron caught the counting of the eggs before they hatched - good oversight. Just wish their dividend was better. I dont really like manufacturer's with little or no dividend. It keeps them honest IMO.

As you said, the article actually serves to confirm your thesis and actually give some insight into the timing of the expected turnaround. Will be fun to watch.

2 additions -

Have you looked at FNF. Book Value below 1, PE low, low cost structure, yet without the risk of typical real estate plays, number 1 player in their industry. I used to be in real estate and the reason I like this company is because if there is ANY business in real estate, then title insurance will benefit. One just cant get around it. Funny, but I like the fact that management lowered the dividend to give them cash flexibility. It still pays a 3.1 % yield and when housing starts rebound, then they should benefit handsomely. If interest rates go up, they should also benefit. Anyway, I think the thesis is simple - the question for me is, is whether or not it passes the MUE calculations.

I know you have a full position in RIG. I am curious whether or not you looked at Noble (NE). I have followed them a couple of years now, have a full position at around $33, and believe they are very well situated to grow by 20% over the next 5 years. Very large, very conservative with their capital, a bit of an aging fleet has been the knock along with GOM moratorium. But they are adding to the fleet steadily but surely and finding new locations for GOM rigs. Analysts expect their earnings to double next year. It is a company that I am very comfortable owning. But basically, they are in the same space as RIG with fewer distractions. Although it would be less diversification, I agree that deepwater drilling stands to be very strong in the next 10 years.

Happy Trails

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