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Speaking of FB, GOOG and others that may be broken up...there is a value play there. I don't think there has ever been a monopoly company (and in most cases, bloated conglomerate) broken up that didn't turn out to be worth far less than the sum of it's parts. There is probably some simple arithmetic that makes that so, though I've never had the gumption to analyze it...so it's just an (unactionable at this point) observation.

lotb
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No. of Recommendations: 2
One area that I seem to have a lot invested in is retail. While looking increasingly like value traps rather than cigar butts, I stand unable to make any kind of meaningful move either to increase or decrease exposure, as bad news hits stock after stock. Time will tell. Luckily, I've got a bunch invested in indexes, a little tech, a little bit of financials and some bonds/fixed income, so it hasn't all been bad.

A little embarrassed to admit holdings in all of the following:

Gamestop (GME)
Tupperware (TUP)
The Gap (GPS)
L Brands (LB)
Mattel (MAT) ...reduced a couple of months ago, and has had a few good days recently, at least.
Petmeds (PETS)
Kohl's (KSS)

...which have performed badly to abysmally in the last year or so. It seems Amazon is going to eat everyone's lunch, or at least that is the expectation.
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No. of Recommendations: 15
Here's the list of companies I follow closely. I update their valuation estimates quarterly. 15 out of the 20 companies I track I own and make up my stock portfolio. Some stuff is on sale, some stuff isn't.

If you're interested in the valuation spreadsheet PM me and I can mail you what I have. It's always fun playing with the inputs to see what different assumptions bring.


Ticker Price Value Price/Value
GM $35.49 $57 0.62
WFC $45.63 $68 0.67
FB $173.35 $236 0.73
AMTD $52.11 $66 0.79
BKNG $1,778.29 $2,233 0.80
TCEHY $42.81 $52 0.82
BAC $27.53 $33 0.83
AAPL $190.15 $226 0.84
GOOG $1,066.04 $1,269 0.84
BRK.B $205.81 $240 0.86
ROIC $17.12 $17 1.01
AXP $121.11 $117 1.04
ATVI $45.38 $42 1.08
AMZN $1,804.03 $1,615 1.12
MSFT $131.40 $110 1.19
SBUX $82.48 $66 1.25
V $170.05 $124 1.37
AMT $212.46 $145 1.47
MA $265.80 $179 1.48
COST $256.01 $169 1.51


Mike
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No. of Recommendations: 3
Hi Mike,

Thanks for the reply. Right now, most of my assets are in trackers and mutual funds. There's a much greater percentage than ever in cash, and the lone single stock holding remaining is BRK. I took profits on everything else when Trump and China decided to begin steps toward the trade war. I'm not at all comfortable with valuations or of course the news flow.

I have been trading this year, more than investing-- although I just dabble in trading. I've had good luck shorting puts conservatively. But the profits there are limited if you aren't careless and I always leave a lot on the table. I've also dabbled in long calls this year, but I've always been wary of that strategy. There's more losers than winners in most cases. AAPL calls have been good to me this year, but I currently own none. V is a name I really like, but I'm waiting for a momentum opportunity. I'll probably buy an in the money long-dated call if the summer brings some better macro news flow. Otherwise, I see myself continuing to index, while holding cash.

Your list is interesting, I'll take you up on the offer of the valuation spreadsheet. I'll email this you as well, if you'd be kind enough to pass it along.

Many financials certainly seem reasonable on a book value basis. But buying B of A at $30ish just feels like buying a cyclical at the top to me. It was great buying it at $4! But that was a lifetime ago. I no longer own it. Current levels in this cruddy interest rate environment worry me. They seem like a bet on the Fed normalizing, but that bets been in place for half a decade. Will it actually come to pass before the next recession? I'm beginning to wonder.

BRK is definitely undervalued IMO. Not surprising. The tide is in, and a lot of people are once again looking at WEB with scorn, as the old guy with hair growing out his ears that's living in the dark ages... I own it and may stubbornly die with it.

The one on your list I really like though is V. The company just oozes cash at fantastic rates. And it pumps that back with repurchases and divis, driving the shares. The big issue is how long it can grow at these rates. I think that's actually quite a while though. It's one of the few GARP stocks I've come across that warrants its valuation IMO.

There are BIG techs that seem fairly valued I agree. Small tech is absurdly valued. The biggest barrier for the biggest is simple Market Cap. Can a tree grow to the sky as the old saying goes? AAPL is fairly priced, although I currently own none. China overhang is obvious... I'm uncertain on MSFT. GOOGL and FB trouble me from a regulatory perspective. From a social/economic perspective, both seem to need regulatory restrictions and will get them IMO. How will that effect them and more importantly their trading? FB derives its revenue from using information in a way that many pols don't like, on both sides of the aisle. Since I tend to agree with them, I have trouble putting money there... If the stocks fall out of favor, there are scads of momentum/growth investors that will punish them relentlessly as they exit. Plus, they're already a large percentage of all my index funds anyway...

This small cap (re-)crash has me wondering if there may be small caps worth considering for a wild money port. I've played in the oil patch before, but that feels unproductive to me at the moment. There's too much long term global growth concern for anyone to believe that oil prices can persist above $50 for a long enough stretch for these guys to repair their balance sheets. Little of deep value is rallying in sympathy with prices as strongly as it has in the past. Energy just seems too out of favor. Autos worry me from a buy-the-top cyclical perspective like financials. A lot of parts suppliers are actually in the deep value bin, as yet another warning. I'm just very wary of putting money to work in this market.

Yet there does paradoxically seem to be some classic value available in small caps. I'm wondering to myself if they're worth a serious look. In the meantime, I'll have to look over some of the rest of your list.

All just my (2-cent) opinion of course...

Thanks,

Peter
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No. of Recommendations: 1
Sometimes all it takes to revive a board is to do what you did - start posting to it! 8-)

(And sometimes it all peters out again.) 8-(
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No. of Recommendations: 3
A little embarrassed to admit holdings in all of the following:

Gamestop (GME)
Tupperware (TUP)
The Gap (GPS)
L Brands (LB)
Mattel (MAT) ...reduced a couple of months ago, and has had a few good days recently, at least.
Petmeds (PETS)
Kohl's (KSS)


jj,

I'm completely out of the loop on retail.

A few of those names (GME,TUP and PETS) turn up in Joel Greenblatt's "Magic Formula" of value picks though.

There are actually a number of very interesting picks that it turns up, including large biotech/biopharma: Amgen(AMGN), Biogen(BIIB), Celgene(CELG), and Gilead(GILD). Larger cap offerings like HP and Seagate also appear on the list in addition to some of the Cigar Butt like names that you'd expect to find.

Peter
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There are actually a number of very interesting picks that it turns up, including large biotech/biopharma: Amgen(AMGN), Biogen(BIIB), Celgene(CELG), and Gilead(GILD). Larger cap offerings like HP and Seagate also appear on the list in addition to some of the Cigar Butt like names that you'd expect to find.


Got AMGN and STX too. I've done good with AMGN and okay with STX.
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No. of Recommendations: 4
My primary screen is high return on capital companies that are growing at a decent clip. For me that means a ROIC in the low teens or higher and revenue growing at least in the high single digits. Then I try to buy these things below fair value, though I'm also okay buying at fair value sometimes, since buying something at fair value that's compounding growth in the high single digits or higher still turns out pretty well. This isn't classic value investing but I've found it works out better, at least for me.

I'm not exclusively looking there. GM doesn't fit my growth rate profile nor does ROIC, but most of what I look at and own fits what I laid out above.

For example, the list of retailers upthread wouldn't be somewhere I'd be looking, though they might show up in more classic value screens.


Mike
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No. of Recommendations: 1
Speaking of FB, GOOG and others that may be broken up...there is a value play there. I don't think there has ever been a monopoly company (and in most cases, bloated conglomerate) broken up that didn't turn out to be worth far less than the sum of it's parts. There is probably some simple arithmetic that makes that so, though I've never had the gumption to analyze it...so it's just an (unactionable at this point) observation.

lotb
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