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Quotes delayed at least 20 minutes. To track performance in Jubak's Picks fairly, the "Price Then" displayed is the closing price on the date each add/drop was made. Until we have a closing price on the first day of the pick, we display the previous day's close as a placeholder.
| Company |
Symbol |
Date
Picked |
Price
Then |
Price
Now |
Today's
Change |
Jubak's
Gain/Loss |
| American Tower Corp |
AMT |
5/10/10 |
$40.86000 |
$49.36 |
unch |
20.80% |
American Tower (AMT) is in the business of building towers and then renting space on that tower to wireless companies. The profitability of a tower depends on how many sites on a tower American Tower can rent. With the current explosion in wireless data and broadband service, wireless companies need more tower space. Add that to new companies such as MetroPCS and Clearwire building out new networks and demand for space on American Tower's 27,256 towers is booming. About 80% of the company's revenue come from the United States and Canada, which makes the company play on the relative outperformance of the U.S. economy (in comparison to other developed country economies). Investors get an extra growth boost with American Tower from its presence in the fast growing wireless markets of Brazil, India, and Mexico. As of the end of 2009 about 6,400 of the company's towers were in those three markets. Standard & Poor's estimates that earnings per share will grow to 94 cents in 2010 from 59 cents a share in 2009. As of May 10, 2010, I'm adding the stock to Jubak's Picks with a target price of $56 a share by April 2011. Full disclosure: I will buy shares of American Tower three days after this is posted.
|
| Whirlpool Corp |
WHR |
5/7/10 |
$98.14000 |
$77.47 |
unch |
-21.06% |
For investors interested in buying shares of Whirlpool (WHR) the recent market rout amounts to a giant rewind. Let me be clear why I’m buying. First, I think the U.S. economy is showing solid growth. That was confirmed for me by rising jobs numbers. I think this maker of home appliances is a good way to play that economic recovery and the rising consumer spending that comes with increased confidence that the economy isn’t about to step off a cliff again. Second, I think that as one of the last men standing in a consolidating global appliance industry -- Whirlpool acquired Maytag in 2006 -- I think Whirlpool is positioned to pick up efficiencies of scale and to gain from growth in developing economies. Standard & Poor’s forecasts that operating margins will climb to 5.4% in 2010 from just 4.8% in 2009. About 60% of the company’s sales come from North America. Europe, which the company is projecting will show no growth in 2010, accounts for 19% of sales, but the company's second-biggest market at 22% of sales is fast-growing Latin America. Whirlpool inked two joint ventures in China in 2008 and 2009 to manufacture refrigerators and washing machines in China for the domestic market as well as for export.I’m going to add this appliance maker to Jubak’s Picks with a target price of $124 by May 2011. Full disclosure: I don’t own shares of any company mentioned in this post.
|
| Cummins Inc |
CMI |
5/5/10 |
$70.41000 |
$81.96 |
unch |
16.40% |
Way back on April 20, I said that I’d like to add shares of Cummins (CMI) to Jubak’s Picks. Well, the stock ran away from me, I mean really ran, before I could get in a buy. Now thanks to the European debt crisis the shares have given up all that gain and a little bit more. As I wrote before, the U.S. economic recovery is on track for decent if not spectacular growth. In that environment I want to own growth stories where the basic underlying positives of the U.S. economy get a rocket booster blast from pent-up demand that has built up during the Great Recession. Sales of Class 8 trucks -- the big rigs -- fell well below the long-term replacement rate during the Great Recession. The result is that the age of the U.S. fleet is now at a two-decade high. That’s a classic replacement drives demand story. Orders have started to turn up so the industry looks like its seen bottom. And while customers were sitting on the sidelines truck makers and their suppliers, especially among the engine makers, were turning out new products that used less fuel and produced lower emissions. Not a minor point when the EPA is putting in tighter emissions standards. Cummins has said in recent guidance that it expects replacement sales to surge at the end of 2010 and into 2011. I think it's time to anticipate that growth. I’m adding this stock to Jubak’s Picks with a target price of $79 a share by March 2011. Full disclosure: I will buy shares of Cummins for my personal portfolio three days after this is posted.
|
| ASML Holding NY Reg ADR |
ASML |
4/20/10 |
$35.83000 |
$26.11 |
unch |
-27.13% |
Talk about rebounds. In 2009, ASML Holding (ASML), a maker of lithography equipment used to etch computer circuits onto silicon, lost 45 cents per American Depository Share (ADS). In 2010, Standard & Poor's is projecting the company will make $2.41 per ADS. The reason for the rebound in earnings is pretty simple. The recovery in the markets for PCs, servers and other computer hardware has convinced the makers of chips of every kind to open up their wallets and begin spending on manufacturing equipment again. ASM Lithography is the top provider of tools used in the most critical semiconductor fabrication process. The in-depth technological expertise required to make these tools helps protect the company's strong competitive position. After a tough 2009, ASML is experiencing a strong rebound in business conditions. In the highly cyclical semiconductor equipment industry the big question is always how long will the good times last. In the case of ASML I think investors are looking for a cycle that could stretch out into 2014. As of April 20, I’m adding shares of ASML to Jubak's Picks with a target price of $42 a share by December 2010. Full disclosure: I don’t own shares of any company mentioned in this post.
|
| US Bancorp |
USB |
3/26/10 |
$26.05000 |
$22.32 |
unch |
-14.32% |
I'm taking US Bancorp (USB) off my watch list and adding it to the Jubak's Picks portfolio. Unfortunately, the stock is up roughly 18% since I added it to the watch list, climbing from $22.01 on Dec. 15, 2009, to $25.90 as of March 26. But with this one I haven't been waiting so much for a pull back in the stock's price as for convincing evidence that the turn in what has been a rising tide at banks of write offs and reserves for delinquent and bad debt is only a quarter or two distant -- and not way off in 2011. I saw signs of that turn in bank earnings reports for the fourth quarter and in credit trend reports for January. The numbers showed that banks that had maintained decent credit quality controls even as peers granted loans to anyone who had a pulse were either seeing an actual improvement in the delinquency rates or seeing the increases in that rate drop significantly. The March 26 report out of Fitch Ratings on February trends in credit card debt pushed me to this buy. For the credit card market as a whole in the month credit card charge offs dropped and delinquency rates continued to improve. As of March 26 I’m adding these shares of Jubak's Picks with a target price of $31 a share by September 2010. This buy reduces the cash position in Jubak’s Picks to roughly 12%. Full disclosure: I own shares of US Bancorp in my personal portfolio. I will buy more shares three days after this buy is posted.
|
| Intel Corp |
INTC |
1/16/10 |
$20.80000 |
$17.90 |
unch |
-13.94% |
Sell on the news, is it? Well, thanks. I thought Intel (INTC) would run away from me after the great Jan. 14 earnings report, but, apparently, traders have decided to take profits on the news ahead of the long Martin Luther Day weekend. And that gives me a chance to add the shares of Jubak’s Picks. I think it looks increasingly like the market will be able to depend on technology stocks for leadership in early 2010. Good thing because the other sector showing signs of leadership recently, financials, looks likely to stumble. Intel reported fourth-quarter earnings of 40 cents a share, 10 cents a share better than Wall Street projections, and revenues of $10.57 billion (up 28.5% from the fourth quarter of 2008) and above the $10.17 consensus. Gross margin came in at 65% versus a Wall Street projection of 62.2%. The stock trades at 13 times 2009 earnings per share, with Wall Street predicting earnings growth of roughly 50% in 2010. As of Jan. 15, I’m adding Intel to Jubak’s Picks. I’m setting a target price of $27.20 a share for December 2010. Full disclosure: I do not own shares of any company mentioned in this story in my personal portfolio.
|
| Companhia De Bebidas ADR Reptg One Pref Shs |
ABV |
1/13/10 |
$104.68000 |
$114.91 |
unch |
9.77% |
I think AmBev's (ABV) fits the recommendations for how to invest in emerging markets. This Brazilian company -- its full name is Companhia de Bebidas Das Americas -- is the fourth-largest beer producer in the world. Its 70% market share in Brazil gives it huge exposure to growth in that country’s domestic economy. And Brazil isn’t a bad beer market to dominate. Beer consumption is forecast to grow by 22% in Brazil from 2008-2015, which ranks Brazil as the second-fastest growing beer market in the world behind China. As of Jan. 13, I’ll be adding these shares to Jubak’s Picks with a target price of $118 by October 2010. Full disclosure: I don’t own shares of any stock mentioned in this post. I will buy shares of AmBev three days after this is posted.
|
| HSBC ADR representing 5 Ord Shs |
HBC |
12/15/09 |
$57.11000 |
$50.46 |
unch |
-11.64% |
At the end of 2008 Hong Kong and the rest of Asia accounted for 26% of HSBC’s (HBC) assets. That percentage will climb as HSBC’s China business grows and as HSBC takes advantage of troubles at competitors to pick up Asian assets. HSBC has emerged as the front runner to buy the assets of troubled Royal Bank of Scotland in China, India and Malaysia. With the Chinese economy set to return to 10% economic growth in 2010 and with Chinese exports likely to return to growth next quarter, owning a bank that owns an increasing bit of Asia’s banking business seems like a good investment. As of December 15, 2009, I’m adding this stock to Jubak’s Picks with a target price of $67 a share by December 2010. The stock pays a dividend of 2.7% as of December 15. (Full disclosure: I own shares of HSBC in my personal account and I will be buying more three days after this is posted.)
|
| Coach Inc |
COH |
11/20/09 |
$33.79000 |
$39.29 |
unch |
16.28% |
Listening to the management team at Coach (COH) talk about the company’s business is an odd experience. This 'fashion' company spends a lot of time talking about 'engineering' its products and building production and distribution 'infrastructure.'And that’s a major reason I like Coach shares in the current tough environment for luxury goods. Anybody can roll out a new product at a lower price point designed to appeal to value-conscious luxury-goods buyers (now there’s a phrase I never thought I’d write), but it takes a company like Coach to introduce the new $300 Poppy handbag lines and 'engineer' gross margins higher at a lower selling price. And the company has told investors to expect gross margins to stay above 72% for the remainder of fiscal 2010. That’s up from earlier guidance of 70% to 72%. As of November 20th, I’m adding shares of Coach to Jubak’s Picks with a target price of $40 a share by October 2010. It traded below $34 Friday. (Full disclosure: I own shares of Coach in my personal portfolio, and I will buy more three days after this is posted.)
|
| Ormat Technologies Inc |
ORA |
11/17/09 |
$40.80000 |
$28.39 |
unch |
-30.42% |
If you think that global climate change is real and that the world does indeed need to do something about it and PDQ, then the delay in addressing the problem turns an already interesting Ormat Technologies (ORA) into a winner deserving a buy from Jubak’s Picks. For two reasons. First, geothermal is one of the few alternative energy technologies that can provide base load electrical power. Wind produces electricity only when it blows, sun only when it shines. Second, the company’s recovered energy generation plants are exactly the kind of easily built quick solutions using proven technology that a world that has dithered over global climate change will need. They can be built just about anywhere that an industrial process throws off heat. We know the technology works. They can be hooked into the current grid (to provide base load power in many cases.) And they require capital in increments that lie within most corporate budgets. On November 4, the company reported third quarter earnings of 52 cents a share, up from 35 cents a share in the third quarter of 2008. Revenue was $120 million, an increase of 20% from the third quarter of 2008. As of November 17, 2009, I’m adding shares of Ormat Technologies to Jubak’s Picks with a target price of $49 a share by November 2010. (Full disclosure: I will buy shares of Ormat Technologies for my personal portfolio three days after this I posted.)
|
| |
LYSCY |
11/6/09 |
$22.000 |
$23.44 |
unch |
6.55% |
As of November 6, I’m adding shares of Lynas (LYSCY) to Jubak’s Picks. China controls about 95% of the global supply of rare earth minerals. And until September 24 China Non-ferrous Mining looked like it was going to buy 52% of Lynas, the Australian company that owns the world’s richest rare earths deposit. But Australian regulators said No to any deal that gave Chinese investors majority control and China Non-ferrous Mining walked away. That left Lynas scrambling to find alternative financing. The company finally did in early November and now it can move ahead with construction of a concentrating plant to do initial processing of the 773,300 metric tons of ore the company has stock piled at the site of its mine, and with the construction of an advanced processing plant in Malaysia that produce rare earth minerals ready for export. As of November 6 I’m adding shares of Lynas to Jubak’s Picks with a target price of $29 a share by October 2010. Full disclosure: I own shares of Lynas ADRs in my personal portfolio. I will buy more three days after this is posted.)
|
| Goldcorp Inc |
GG |
11/5/09 |
$40.44000 |
$42.07 |
unch |
4.03% |
Goldcorp (GG) reported third quarter earnings after the market close on November 4. The short-term news was that the company beat Wall Street earnings estimates by three cents a share and revenue projections by $77 million. China has been quietly buying gold for years, doubling its holdings over the last six years. But the country still holds only 2% of its reserves in gold. Even after India’s big buy, that country has just 6.2% of reserves in gold. Contrast that not just to the 32.7% peak in 1989 or to the 10.3% global average at the end of 2008, but to the 60% average in Europe or the 77% of reserves that the U.S. holds in gold. The Reserve Bank of India had 20% of its reserves in gold fifteen years ago. Before this recent buy, reserve levels had tumbled to just 3.2% in gold. A buy the size of India’s is certainly big enough to change the supply/demand side of the global gold market. Its purchase of 200 metric tons of gold is equal to about 8% of the total annual output from the world’s gold mines. With this post I’m adding Goldcorp to Jubak’s Picks with a target price of $48 a share by October 2010. Full disclosure: I will buy shares of Goldcorp for my personal portfolio three days after this is posted.
|
| Teva Pharmaceutical Industries ADR Reptg One Ord Shs |
TEVA |
10/13/09 |
$51.19000 |
$54.31 |
unch |
6.09% |
No matter what health care reform bill emerges from Congress this year -- or if there’s no bill at all -- the pressure to get costs out of the health care system is just going to get more intense. Generic drug makers win once because any legislation will expand the number of insured able to afford drugs, and twice, because economics will continue to move patients, doctors, and health care bill payers to generics. No wonder Teva Pharmaceutical Industries (TEVA) is guiding Wall Street to 30% earnings growth in 2010. As of October 13, 2009, I’m adding Teva Pharmaceutical Industries to Jubak’s Picks with a target price of $61 a share by October 2010. That values Teva at about 14x my estimate of 2010 earnings of $4.35 a share. As of October 13th, the stock traded above $51 -- 14.25x Standard & Poor’s estimate of 2009 earnings. Full disclosure: I do not own or control shares of any company mentioned in this post.
|
| WR Berkley Corp |
WRB |
10/7/09 |
$25.86000 |
$26.37 |
unch |
1.97% |
I’m buying the common shares of W.R. Berkley (WRB) as a replacement for the preferred shares that I sold out of Jubak’s Picks. I think they offer almost twice the up side with just slightly more risk. I’m a big fan of the very conservative ship run by chief executive officer William Berkley. No financial company has escaped all damage from the recent (and, in my mind, continuing) financial crisis, but W.R. Berkley has dodged most of the big bullets. The $108-million write-down that WRB took in the fourth quarter, for example, was on invested assets of $12.5 billion. The up side here is that, as the company told Wall Street in April, it looks like prices in its property and casualty insurance lines are starting to turn. In April, the company said it expected prices to improve as weaker insurers abandoned business by the end of 2009. As of October 7th, I’m adding this stock to Jubak’s Picks with a target price of $33 a share by September 2009.
|
| Cisco Systems Inc |
CSCO |
09/25/09 |
$22.62000 |
$20.64 |
unch |
-8.75% |
So far on the morning of November 5, Cisco systems' (CSCO) results have helped send the overall market upwards. This quarter investors could see the tipping point in the company’s order book. Total orders were still down by 7%-9% from the fiscal first quarter a year ago. But that’s a huge improvement from the 30% year to year decline the company has cited in recent quarters and shows that orders are actually picking up at Cisco. In the quarter enterprise orders—that’s orders from big corporations—were ahead 10% from the fiscal first quarter a year ago. In the conference call the company projected that for the fiscal second quarter that ends in January 2010 revenue would show a year to year increase or 1% to 4%. That doesn’t seem like much but it would mark Cisco’s return to revenue growth. That kind of growth translates into revenue of $9.2 billion to $9.45 billion. The Wall Street consensus had been for revenue of $9 billion. (As of November 5, I’m tweaking my target price higher to $29 a share by June 2010 from the previous $28 by that month. Full disclosure: I own shares of Cisco Systems in my personal portfolio.)
|
| Market Vectors Brazil Small-Cap ETF |
BRF |
09/11/09 |
$38.200 |
$53.21 |
unch |
39.29% |
The fundamentals are improving in Brazil--but right now global cash flows are driving emerging-market stocks.In the long run, I want Brazil in my portfolio because of those improving fundamentals. In the short run, I want to own Brazilian stocks because global cash is flowing their way. In the intermediate term, though—say, nine months from now--I want to get increasingly cautious as the US Federal Reserve moves towards raising US interest rates. Right now all that adds up to a new higher target price for Market Vectors Brazil Small-Cap ETF (BRF). As of October 15th, I'm raising my target price on the Market Vectors Brazil ETF to $51 by June 2010 from the prior target of $44 by that date. It was trading below $46 on the 15th. (Full disclosure: I own shares of iShares MSCI Brazil Index ETF and Market Vectors Brazil Small-Cap ETF in my personal portfolio.)
|
| Johnson Controls Inc |
JCI |
09/08/09 |
$25.26000 |
$27.92 |
unch |
10.53% |
You certainly can’t say that Johnson Controls (JCI) has turned the corner. But it does look like the corner is in sight. Before the market opened on October 27th, Johnson Controls reported earnings of 52 cents a share for the company’s fiscal fourth quarter of 2009. That beat the Wall Street consensus by a penny a share. The problem is, that came from more successful than expected cost cutting rather than from increases in sales. Even though it came in $40 million above analyst projections, revenue, in fact, fell by 15.5% from the fourth quarter of fiscal 2008. Revenue dropped in all three of the company’s business segments. Sales in what Johnson Controls calls the Automotive Experience segment (auto interiors) dropped by 14%. Power Solutions (a.k.a. batteries) showed a drop in sales of 14%. And the Building Efficiency unit (air conditioning and build energy management) witnessed a 16% drop in sales. But units that had been in the red, such as Automotive Experience, returned to the black in the quarter even with the drop in sales thanks to aggressive cost cutting. And units that had been profitable, such as Power Solutions, saw operating margins increase. In many of its businesses--Automotive Experience, for example--Johnson Controls seems to be taking market share. Cost-cutting measures will translate into improving margins as sales volume gradually returns. As of October 27, I’m raising my target price for Johnson Controls by $1 to $32 a share by July 2010. (Full disclosure: I own shares of Johnson Controls in my personal portfolio.)
|
| Energy Transfer Partners LP |
ETP |
11/11/08 |
$35.75000 |
$46.76 |
unch |
30.80% |
The longer the Federal Reserve promises to keep interest rates low, the more valuable Energy Transfer Partners (ETP) is and the longer I want to hold it. In its press release from its June 24 meeting the Federal Open Market Committee said it 'continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.' Units of Energy Transfer Partners now yield 8.03% versus a Fed funds target rate of 0% to 0.25%. As of July 29, I'm raising my target price for this master limited partnership to $49 a unit by June 2010 from my prior target of $47 by March 2010. (Full disclosure: I own units of Energy Transfer Partners in my personal portfolio.)
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| ONEOK PARTNERS LP |
OKS |
10/07/08 |
$41.71000 |
$70.25 |
unch |
68.42% |
Certainly not a great quarter but it will do. After the close on Aug. 4 Oneok Partners (OKS) announced second-quarter earnings of 81 cents a unit. (This is a master limited partnership rather than common stock.) That was down from $1.46 in the second quarter of 2008. But with most of its capital spending budget about to go from a drag on cash flow to a contributor to revenue, I'm going to hold onto these units and up my target price a tad. With a master limited partnership, which gets special tax treatment because it passes most of its cash flow on to investors, the issue is always cash flow and whether it's enough to cover distributions or not. ONEOK came up short in the first half of 2009 with cash flow from operations of $189 million and cash distributions of $242 million. The company was able to make up with difference from cash balances and by selling debt. I wouldn't like to see that go on for very long. The second quarter numbers suggest it won't for two reasons. First, although distributable cash flow continued its decline -- dropping 26% from the second quarter of 2008 -- the rate of decline is slowing. And it's slowing with the company still on the right side of the cash flow ledger. Distributable cash flow for the quarter was 1.1 times distributions. Second, ONEOK will see revenue risk over the next few quarters as new pipelines come into use. The Arbuckle Pipeline went into use this quarter increasing capacity out of the Barnett Shale formation in Texas. The Piceance Lateral pipeline is expected to come on line in the third quarter. The company projects distributable cash flow for 2009 in the range of $505 million to $545 million. In reaching its projections the company used oil at $64 a barrel and natural gas at $4. As of Aug. 5, I'm raising my target price to $54 a unit by March 2010. (Full disclosure: I own shares of ONEOK in my personal portfolio.)
|
| Transocean Inc |
RIG |
8/1/08 |
$137.61000 |
$53.74 |
unch |
-60.95% |
By idling and stacking rigs aggressively, Transocean (RIG) the owner of the largest rig fleet in the world, has stabilized day rates even in this downturn. The average rate for the company’s deepwater rigs rose by 14%, and the average day rate across Transocean’s fleet climbed by 17%. The issue this quarter, as it was last quarter, is when the turn will come in the market for offshore rigs. Transocean continues to talk about a recovery in the first half of 2010. The company is burning through about $1 billion of its order backlog every month, but with $32 billion in backlog as of November 2nd, it has enough backlog to see it through this downturn unless it extends well past the midyear timetable for a recovery. Recent numbers that show the Chinese economy running even hotter than expected are good news for companies such as Transocean. As of November 9th, I’m leaving my target price at $105 a share by June 2010. It traded at around $90 Wednesday. (Full disclosure: I own shares of Transocean in my personal portfolio.)
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| Middleby Corp |
MIDD |
5/20/08 |
$57.41000 |
$58.38 |
unch |
1.69% |
On November 10, Middleby (MIDD) reported third-quarter earnings of 83 cents a share, four cents better than Wall Street projections, but still 19% down from the third quarter of 2008. Revenue fell 7.5% from the third quarter of 2008, and at $154 million, was about $10 million below the Wall Street consensus. If you used a magnifying glass, you could find signs of improvement in the revenue number. In the second quarter of 2009, revenue was down 8.6% from the second quarter of 2008. In the third quarter, the year-to-year decline was just 7.2%. The earnings looked slightly better, too: Gross margin climbed to 40.3% in the quarter from 38.9% in the third quarter of 2008. The company projects that conditions in commercial kitchen equipment/cooking unit business will remain 'challenging' (their word, not mine) into the first half of 2010. I think this is a well-run company that is positioned to take advantage of any economic recovery and the resulting upturn in store openings among restaurant chains, as well as any increase in those companies’ spending on new equipment from Middleby that can reduce their operating costs. As of November 23, 2009, I’m keeping my target price at $65 a share, but stretching out the time table to November 2010 from July 2010. The stock traded above $46 Monday. (Full disclosure: I own shares of Middleby in my personal portfolio.)
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| Enbridge Inc |
ENB |
12/18/07 |
$38.41900 |
$51.20 |
unch |
33.27% |
Enbridge (ENB) has held up well during the bear market. The total return -- price gains of 4.56% and dividend payments of $1.32 a share since my December 2007 buy -- comes to 8.4%. Some of that is the result of the stock's dividend, about 3.1% as of Sept. 22. But more, I think, is related to on-track progress in the company's new pipeline and wind-power projects. As these projects go into service, they go from being a drain to being a contributor to Enbridge's bottom line. For example, the Waupisoo Pipeline, to bring oil from the Alberta oil sands to Edmonton, went into service in the second quarter, a month ahead of schedule. The company's Ontario Wind Project is on track for completion later this year. The Alberta Clipper project remains on schedule for 2010. It has also helped the stock that the company has been able to raise $1.4 billion from its sale of a 25% interest in Spanish pipeline company Compania Logistica de Hidrocarburos. That's capital that Enbridge doesn't have to raise in today's volatile financial markets. As of Sept. 23, I'm increasing my target price for shares of Enbridge to $48 a share by February 2009 from my prior target of $46 by December 2008. (Full disclosure: I own shares of Enbridge in my personal portfolio.)
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| Thompson Creek Metals Co Inc |
TC |
06/26/07 |
$15.47080 |
$9.53 |
unch |
-38.40% |
On November 5th, molybdenum miner Thompson Creek Metals (TC) reported third-quarter earnings of 14 cents a share, three cents a share above the Wall Street consensus, and revenue of $114 million, well above analysts’ projections of $90 million. The upside came from lower costs at just $5.67 per pound of molybdenum and from higher sales volumes -- up 17% from the second quarter, although still down 12% from the third quarter of 2008. Molybdenum prices remained depressed at $12.75 a pound, down a huge 61% from the third quarter of 2008. The best news, though, wasn’t in the numbers for the third quarter but in the company’s guidance for 2009 and 2010. Thompson Creek Metals raised its projected production volume for 2009 to 24 to 26 million pounds (from previous guidance of 22 to 26 million pounds) and for 2010 to 29 to 32 million pounds. At the same time, the company lowered its estimates of the cost of production to a range of $5.80 to $6.30 a pound in 2009 (from $5.75 to $7.00). For 2010, the company estimated costs at $6 to $7 a pound. With molybdenum prices showing signs that they might creep up towards $15 or 16 a pound in 2010 with a gradual recovery in the global economy, as of November 24th I’m raising my target price just a tad to $16.50 a share by July 2010 from the previous $15 by May 2010. It traded at around $12 Tuesday. I think Thompson Creek Metals is worth a look if you’re trying to increase your exposure to non-US equities. (Full disclosure: I own shares of Thompson Creek Metals in my personal portfolio.)
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| Maxwell Technologies Inc |
MXWL |
01/23/07 |
$12.55000 |
$12.35 |
unch |
-1.59% |
On September 22, Maxwell Technologies (MXWL) reported that Continental AG, one of the biggest suppliers of electronic and mechanical systems to car makers, had picked Maxwell’s BOOSTCAP ultra capacitors as the energy storage component in a voltage stabilization system it has developed to improve fuel efficiency and reduce emissions by shutting off the engine when a car slows and then restarting it when the driver steps on the gas. Maxwell’s ultra capacitors store electricity to provide power for restarting the engine without overworking the battery. What’s important about the win at Continental is that it’s for a high-volume product in an industry that’s rapidly introducing new technologies to improve mileage. Car makers also face a big tightening of emissions standards as Europe implements its carbon reduction goals. The win at Continental also validates the product and is likely to lead to other wins. Profit margins are likely to rise with production volumes and with the company’s move of some ultra capacitor production from Switzerland to China. As of September 28, I’m setting a new target price of $25 a share by July 2010. (Full disclosure: I own shares of Maxwell Technologies in my personal portfolio.)
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|
| Company |
Symbol |
Date
Dropped |
Price
Then |
Price
Now |
% Change
Since Dropped |
| McDonald's Corp |
MCD |
8/12/10 |
$72.06000 |
$76.08 |
5.58% |
McDonald's (MCD) has put together an extraordinary 2010 -- so far. But I’m not as excited about the second half of the year, especially not at current share prices. McDonald's sales are hitting on all cylinders: the dollar menu, new higher priced menu offers, frozen frappes, and upgraded coffee drinks have all boosted sales since their roll outs. However, it's not sales that worry me but margins. In the first half of 2010 McDonald's benefitted from falling commodity prices for wheat, corn syrup, sugar, beef, chicken and other raw materials. In its last conference call with analysts, the company said that it expected commodity prices to continue to decline in the second half of the year but at a reduced rate. With wheat and other grain prices soaring on drought, wild fires, and grain export bans, I don't think declining commodity prices are guaranteed in the second half of 2010. That wouldn’t be a problem except that the stock has become rather expensive given the 13% earnings growth projected by analysts for 2010 or the 8.2% growth rate projected for 2011. The works out to a price to earnings growth ratio on 2011 earnings growth of almost 2. That doesn't leave much room for a disappointment on margins if commodity prices stay high or climb higher for the rest of 2010. As of Aug. 12, I'm selling McDonald's with a gain of 21% -- plus dividends -- since I bought the shares Jan. 13, 2009.
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| Impala Platinum Holdings ADR |
IMPUY |
6/17/10 |
$26.20000 |
$24.22 |
-7.56% |
I’m going to use the current bounce, World-Cup-rally, summer rally, whatever to sell my position in Impala Platinum (IMPUY). The South African stock looks like it's in a steady downtrend despite its 13.8% gain off the June 4 low. Platinum was bid up heavily by traders who bought it as a speculative precious metals play on market volatility, but the problem with platinum, unlike, say, gold, is that it's both a precious metal and an industrial metal. With the European economy slumping and the U.S. economy showing signs of slower growth, the industrial demand for platinum hasn’t lived up to hopes and traders have been unwinding positions since April. I'm selling now with a 3.7% loss since I added the stock to Jubak’s Picks on Jan. 25, 2010. I don’t think the current rally has much upside, and I’m looking to raise cash for buys on market weakness later in 2010. Full disclosure: I will sell my personal position in Impala Platinum three days after this is posted.
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| Microsoft Corp |
MSFT |
6/10/10 |
$25.00000 |
$23.93 |
-4.28% |
I'm going to take advantage of the half-hearted bounce this week to sell Microsoft (MSFT) The stock has not performed well on up days for the market and looks locked into a short-term downtrend. (On the chart Microsoft is flirting with a negative cross-over where the 50-day moving average breaks below the 200-day moving average.) I might want to own this one in the fall again when visions of higher sales for operating systems and for Office 2010 start to dance in investors' heads. But for the summer I think I’d rather sit in cash and preserve my ability to put my money into the best opportunity of those that will eventually present themselves after the current correction (or whatever) gets resolved. This sale will move my cash position in Jubak's Picks up to about 37%. I’m selling with a 6% gain since I added the stock to the portfolio in July 2009. Full disclosure: I will sell my personal position in Microsoft three days after this is posted.
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| Microsoft Corp |
MSFT |
6/10/10 |
$25.00000 |
$23.93 |
-4.28% |
I'm going to take advantage of the half-hearted bounce this week to sell Microsoft (MSFT) The stock has not performed well on up days for the market and looks locked into a short-term downtrend. (On the chart Microsoft is flirting with a negative cross-over where the 50-day moving average breaks below the 200-day moving average.) I might want to own this one in the fall again when visions of higher sales for operating systems and for Office 2010 start to dance in investors' heads. But for the summer I think I’d rather sit in cash and preserve my ability to put my money into the best opportunity of those that will eventually present themselves after the current correction (or whatever) gets resolved. This sale will move my cash position in Jubak's Picks up to about 37%. I’m selling with a 6% gain since I added the stock to the portfolio in July 2009. Full disclosure: I will sell my personal position in Microsoft three days after this is posted.
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| Rayonier Inc |
RYN |
5/28/10 |
$44.88000 |
$48.01 |
6.97% |
I've already sold Rayonier (RYN) out of the Jubak Dividend Income Portfolio on May 28. And now I’m selling it out of Jubak Picks as well. Nothing is wrong with the stock. When the real estate market does finally turn, this timber and real estate REIT will do quite well. But I think that turn is still a long way away and that investors will see better places to put their money to work -- most likely in the world’s emerging stock markets --before then. I’m looking at a 2% drop in the price of a Rayonier share since I added it to the portfolio on Nov. 9, 2007. On a total return basis -- that’s capital gain (or in this case loss) plus dividend payments -- I’ve got an 8.4% profit. Full disclosure: I will sell Rayonier out of my personal portfolio three days after this is posted. I will also be selling Rayonier out of my Jubak Dividend Income portfolio.
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| Marvell Technology Group Ltd |
MRVL |
5/26/10 |
$18.37000 |
$17.39 |
-5.33% |
I'm going to use today's bounce to sell Marvell Technology Group (RYN). I don't know how long this bounce will run -- it could go to 1220 or so on the Standard & Poor's 500 or be truncated by investors selling into strength -- but I would like to lighten up on technology for the summer quarters. Marvell Technology is the most volatile of my tech holdings. That will be good news when the group rallies but right now it exposes me to more risk than I'd like. As of May 26, I'm selling Marvell Technology Group out of Jubak's Picks with a 5.3% loss since I added the stock to the portfolio on Jan. 19, 2010. Full disclosure: I will sell my personal position in Marvell Technology Group three days after this is posted.
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| Statoil ADR Rep 1 Ord Shs |
STO |
5/21/10 |
$19.78000 |
$19.87 |
0.46% |
I'm selling Statoil (STO) on today's bounce because the euro debt crisis has changed the medium-term fundamentals for this Norwegian oil company. As I wrote earlier, I think investors should try not to get caught up in panic selling during this market drop, but on the other hand that doesn't mean they shouldn't sell anything. The euro debt crisis will depress growth in Europe, lowering global demand for commodities such as oil and local demand for commodities such as natural gas. That means that the crisis has changed the fundamentals of Statoil for the worse. I still like the company's long-term positioning as a natural gas supplier near to gas-starved Europe and its technology edge in exploring nearly opening Arctic waters for oil. I've waited to sell until the record date passed for the company's most recent dividend (about 95 cents a share on May 19) and then waited some more for a bounce. As of May 21, I'm selling these shares with a loss of 14% since my purchase on Sept. 23, 2009.
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| Yara International Each Repr 1 ADR |
YARIY |
5/19/10 |
$29.65000 |
$41.97 |
41.55% |
I love fertilizer stocks as a long term play on rising global demand for food and Yara International (YARIY), the world's largest publicly traded fertilizer company, is one of my favorites in the sector. But that's the long term picture. In the short term, Yara International is still a commodities stock and right now the commodity sector is getting killed on worries that growth is going to slow in Brazil, India, China and the rest of the developing world as their governments raise interest rates and tighten the money supply in order to fight inflation. I'll be on the lookout to re-buy these shares at a lower price later in 2010 when I'm looking for the turn in emerging markets. (Yara remains one of the 50 stocks in my long-term Jubak Picks 50 portfolio.) I'm selling on May 19, 2010, with a loss of 1% since I added the stock to the portfolio on May 22, 2007. Full disclosure: I will sell my own shares of Yara International three days after this is posted.
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| Market Vectors Gold Miners ETF |
GDX |
5/11/10 |
$53.60000 |
$53.67 |
0.13% |
I don't want to get greedy with Market Vectors Gold Miners ETF (GDX). Gold is near its all time high of $1227.50 an ounce set on December 3, 2009. You don't have to look far to find the reasons: the euro debt crisis and inflation fears in China. I think gold could run higher from here. The euro crisis isn't over what with the credit rating companies that haven't rated Greek government bonds as junk threatening to do so. And I think we'll see at least one more spasm of fear from China. But I think the risk reward ratio is shifting. Gold is getting closer to the end of its rally and emerging market stocks are getting closer to the beginning of their recovery. So I'm going to exit this trade to raise some cash for an eventual move into China and other emerging markets. Not yet, mind you, but soon. As of May 11, I'm selling Market Vectors Gold Miners ETF with a 10.3% gain since I added it to the Jubak's Picks portfolio on April 8, 2010. Full disclosure: I do not own shares of this ETF.
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| Taiwan Semiconductor Manufacturing ADR representing Five Ord |
TSM |
5/7/10 |
$9.89000 |
$9.52 |
-3.74% |
On April 27 I decided to hold onto shares of Taiwan Semiconductor Manufacturing (TSM)for a little longer. I thought the risk was relatively small and the upside to my target of 17% provided enough reward. Well, the world looks significantly different two weeks later. Risk has gone up and the reward for investing in Taiwan Semiconductor has gone down. The Taiwanese stock market has shown itself very susceptible to anything that roils China's markets. I think the direction of China's stock market still points down for another few months, at least, and the volatility of all emerging markets is on the rise. Full disclosure: I own shares of Taiwan Semiconductor Manufacturing in my personal portfolio. I will sell that position three days after this is posted.
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