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November, 2007: 4 10 12 24

Disclaimer - IMPORTANT - Read this first!

Investor's Journal is a diary focused strictly on investments and personal finance issues, primarily from a contrarian and retiree point of view. Follow along with an average guy's failures and successes as he learns, by trial and error, the fine art of value investing.

My top-ten equities for mention today are: ARW; AVT; FEP; KEQU; MALL; MCK; NSHA; PCR; TSO; and VLO.

The focus this time is on a new Leapin' Lizards (LL) selection, Perini Corp. (PCR) (recent price $56.96). PCR's trailing price to earnings ratio is 19.48. The estimated forward price to earnings ratio is 17.86. The asset's market-capitalization size is small-cap: $1.53 billion. Perini Corp. has no dividend. The PEG ratio is 1.43. The price to sales ratio is only 0.50. PCR's price to book value is 4.86. There is positive free cash flow. Return on equity is 31.24%. Debt to equity is 0.08. The current ratio is 1.23. The price is up 100.85% in the past 52 weeks. This stock has low price to sales, low debt, and good momentum in its favor.

Perini Corp. will be added to our LL tracking portfolio at its market price early on Monday, 11/5/07.

11/10/07-Since the last entry, our Classic Value (CV) pick, NXG, purchased on 11/10/06, has been held over a year, and so it will be sold at the early market price Tuesday morning. It will then be removed from the CV open positions portfolio, and its closed position info recorded, based on the 11/10/06 to early 11/13/07 per share performance. Through the close of trading on 11/9/07, after subtracting a commission (while not counting any dividends), NXG had been up 11.06% in the past almost 12 months.

Note that also since the prior entry our CV pick, LMS, purchased on 2/12/07 at $28.59 a share, was bought out by another company for $27.30 in cash, a loss of 4.51%.

My top-ten equities for mention today are: ASPV; AVCI; AXS; BRK/A (BRK/B); NTRI; ORH; PLAB; SCVL; TDW; and WMAR.

The focus this time is on a new Classic Value (CV) selection, Photronics, Inc. (PLAB) (recent price $9.76). PLAB's trailing price to earnings ratio is 13.07. The asset's market-capitalization size is micro-cap: $408.40 million. Photronics, Inc., has no dividend. The PEG ratio is 2.06. The price to sales ratio is 0.92. PLAB's price to book value is only 0.61. There is positive free cash flow. Return on equity is 5.43%. Debt to equity is 0.27. The current ratio is 2.02. This stock has low price to book value and low debt in its favor. The asset meets Ben Graham value and safety criteria as a bargain stock.

Photronics, Inc., will be added to our CV tracking portfolio at its market price early on Tuesday, 11/13/07.

Just a reminder: although for comparison purposes I am continuing to follow Leapin' Lizards and to point out selections using that strategy, we are not any longer buying new stocks following the LL approach ourselves (because in down markets they seem too vulnerable to losses), and I do not encourage readers to do so either.

So far, however, after over three years' experience with the Classic Value strategy, we continue (including through the most recent closed positions) to see better than two to one winners to losers in this approach and an annualized total return (for stocks held for a year and a day or till bought out, whichever earlier) of better than 21%. Considering that this is a fairly low risk strategy that requires only a few minutes' online research per purchase, I am well pleased with the outcome so far and commend it to others.

11/12/07-In the 11/10 entry, I mentioned that the early Tuesday (11/13) market prices of NXG and PLAB would be used for calculating the sell price, and so closed position performance, of NXG, as well as the cost of new shares of PLAB to be purchased then. I had thought the markets would be closed today due to the Veterans' Day bank and federal holiday. However, I see that the markets are indeed open for stock trading. So those tracked portfolio transactions have been made this morning instead, based on a price per share early today for NXG of $3.23 and for PLAB of $9.71.

Including LMS and NGX, the current (after commissions, but not counting dividends) annualized performance of all CV closed positions since the Classic Value portfolio was begun in early 10/04 stands at 18.98%. Once a conservative average dividend of 1.7% a year (though value assets often average higher dividends than the rest of the equity market) has been added, the total return for CV since 10/04 is estimated to have averaged 20.68% a year. These CV closed positions through today's transactions have included 45 winners and 23 losers, or almost a two to one win to loss ratio.

11/24/07-Since the last entry, our Leapin' Lizards (LL) pick, FCPO, purchased on 5/14/07, was bought out for $16.50 per share in cash, effective 11/19/07, by AAH Holdings Corp. This represents a 31.08% increase from our $12.54 per share plus commission cost basis, a pretty good return for a roughly six-month holding.

Also since the last entry, however, our Leapin' Lizards (LL) pick, VOL, purchased on 11/17/06, has been held over a year, and it shows a substantial loss. It will be sold at the early market price Monday morning. It will then be removed from the LL open positions portfolio, and its closed position info recorded, based on the 11/17/06 to early 11/26/07 per share performance. Through the close of trading on 11/23/07, after subtracting a commission (while not counting any dividends), VOL had been down 57.18% in the past 12(+) months.

My top-ten equities for mention today are: AXYS; BKR; INXI; LDG; MCK; NSHA; BKR; POT; VLGEA; and VSEC.

The focus this time is on a new Leapin' Lizards (LL) selection, Michael Baker Corp. (BKR) (recent price $34.83). BKR's trailing price to earnings ratio is 11.28. The asset's market-capitalization size is micro-cap: $306.85 million. Michael Baker Corp. has no dividend. The price to sales ratio is only 0.42. BKR's price to book value is 2.66. There is positive free cash flow. Return on equity is 27.67%. Debt to equity is 0.00. The current ratio is 1.51. The price is up 73.72% in the past 52 weeks. This stock has low price to sales, low debt, and good momentum in its favor.

Michael Baker Corp. will be added to our LL tracking portfolio at its market price early on Monday, 11/26/07.

This is just to remind readers that I am not currently recommending purchase of LL assets, as they have had disappointing overall returns relative to suggested Classic Value (CV) assets. Nonetheless, for yet awhile we shall continue to show the LL picks and performance, for comparison's sake.

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