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December, 2008: 3 14 31
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. |
12/3/08-Since the last entry, our Leapin' Lizards (LL) pick, BKR, purchased on 11/26/07, has been held over a year. It will be sold at the early market price Thursday morning. It will then be removed from the LL open positions portfolio, and its closed position info recorded, based on the 11/26/07 to early 12/4/08 per share performance. Through the close of trading today, after subtracting a commission (while not counting any dividends), BKR had been down 7.75% in the past 12(+) months.
Since the last entry too, our Classic Value (CV) pick, ENH, purchased on 12/3/07, has been held a year. It will be sold as well at the early market price Thursday morning. It will then be removed from the CV open positions portfolio, and its closed position info recorded, based on the 12/3/07 to early 12/4/08 per share performance. Through the close of trading today, after subtracting a commission (while not counting any dividends), ENH had been down 35.07% in the past 12(+) months.
My top-ten equities for mention today are: AEO; BRK/A (BRK/B); CDI; CMI; DCO; GIFI; MEI; NOC; RDS-A; and WSM.
The focus this time is on a new Classic Value (CV) selection: Royal Dutch Shell, Class A shares (RDS-A) (recent price $50.00). RDS-A's trailing price to earnings ratio is just 4.20. Its forward P/E is estimated at 5.00. The asset's market-capitalization size is giant-cap: $156.06 billion. Royal Dutch Shell, Class A shares has a 6.27% dividend, with a dividend payout ratio of 0.26. The price to sales ratio is only 0.33. RDS-A's price to book value is below average, at 1.15. The price to cash flow ratio is just 3.10. Return on equity is 29.26%. Debt to equity is only 0.12. This stock has low price to earnings, low price to sales, below average price to book value, low P/CF, low debt, and a superior dividend in its favor. It meets Ben Graham's value and safety bargain stock criteria.
Royal Dutch Shell, Class A shares will be added to our CV tracking portfolio at its market price early on Thursday, 12/4/08.
I anticipate just one or two more entries before my wife and I shall be on vacation for the holidays. On our return, it will be time for the quarterly and year-end summaries, not that I am looking forward to them. Their results promise to be the worst since when we began keeping these stats. However, relative to the market averages we have so far been doing reasonably well, at least in our CV closed position returns. And our own nest egg's total equity market value to total book value ratio has to date never looked better (currently at only 0.74).
12/14/08-Since the last entry, our Leapin' Lizards (LL) pick, FEP, purchased on 12/11/07, has been held over a year. 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 12/11/07 to early 12/15/08 per share performance. Through the close of trading on 12/12/08, after subtracting a commission (while not counting any dividends), FEP had been down 72.73% in the past 12(+) months. It is no doubt just as well that our period of focusing on and then following LL assets is nearing an end!
My top-ten equities for mention today are: AMPH; BJS; CDI; CIR; DCO; ESV; GIFI; HCC; ISIL; and MOV.
The focus this time is on a new Classic Value (CV) selection: Ensco International, Inc. (ESV) (recent price $31.85). ESV's trailing price to earnings ratio is just 4.18. Its forward P/E is estimated at 3.81. The asset's market-capitalization size is mid-cap: $4.52 billion. Ensco International, Inc. has a small (0.30%) dividend, with a dividend payout ratio of 0.02. The price to sales ratio is 1.83. The PEG ratio is 0.37. ESV's price to book value is below average, at 1.01. There is positive free cash flow. The price to cash flow ratio is just 3.50. Return on equity is 28.01%. Debt to equity is only 0.07. The current ratio is 3.12. Shareholder equity to total assets is 0.80. This stock has low price to earnings, below norm price to book value, low P/CF, and low debt in its favor. It meets Ben Graham's value and safety bargain stock criteria.
Ensco International, Inc. will be added to our CV tracking portfolio at its market price early on Monday, 12/15/08.
This will be my last entry here till around the beginning of the new year. Hope everyone has a great Yuletide holiday!
12/31/08-My wife and I are just back in town after a holiday vacation, but I wanted to get an abbreviated entry in quickly, before today's end of the market year. So here are some bare bones observations and/or analyses.
As of their market price at 1:40 PM today (Central Time), I have sold the following from our hypothetical portfolios, each of which has been held a year or more. Their closed position info will be appropriately recorded, and they will be deleted from the respective open positions portfolios:
- RCMT, a Classic Value (CV) holding since 12/17/07. So far, it is down 82.64% since its hypothetical purchase about a year ago.
- ZEUS, a Leapin' Lizards (LL) holding since 12/24/07. So far, it is down 36.69% since its hypothetical purchase about a year ago.
In addition, I am selling CHMP, a CV holding since 12/31/07, as of the market price early on 1/2/09, by which time it will have been held for at least a year and a day. Its closed position info will also be recorded, and it will be deleted from the open positions CV portfolio. So far, it is down 40.34% since its hypothetical purchase about a year ago.
The ten stocks of greatest recent interest for me were: BJS; BRK/A (BRK/B); CBRL; CHE; COP; DCO; GD; ISIL; LNC; and MCD.
The focus this time is on a new CV asset: BJ Services Company (BJS) (recent price $11.77). BJS's trailing price to earnings ratio is just 5.65. Its forward P/E is estimated at 7.51. The asset's market-capitalization size is mid-cap: $3.40 billion. BJ Services Company has a small (1.76%) dividend, with a dividend payout ratio of 0.10. The price to sales ratio is 0.61. The PEG ratio is 1.18. BJS's price to book value is below average, at 0.97. There is positive free cash flow. The price to cash flow ratio is just 3.80. Return on equity is 19.37%. Debt to equity is 0.16. The current ratio is 1.92. Shareholder equity to total assets is 0.65. This stock has low price to earnings, below norm price to book value, low P/CF, and low debt in its favor. It meets Ben Graham's value and safety bargain stock criteria.
BJ Services Company is being added to our hypothetical CV tracking portfolio at its market price as of 1:40 PM (Central) today: $11.77. I am also adding it to our actual nest egg.
Except for the upcoming performance summary, this is the last time the Leapin' Lizards assets will be addressed. Although both Leapin' Lizards and Classic Value assets have done badly in the downturn, the relative performance of the initially good momentum LLs, even with low debt and low price to sales, has been sufficiently bad vs. CV that they will not be considered further, even for purposes of comparison.
It is time for the quarterly and annual analyses. The next entries will cover those reviews. Meanwhile, I wish everyone a HAPPY NEW YEAR! Hope we all have at least a better 2009 than what most investors experienced in 2008!
Disclaimer and Disclosure Statement
Neither I nor Investor's Journal will be responsible for losses by anyone who obtained ideas from this site.
This diary is intended for personal interest and general information only. You are advised to do your own research (as well as to consult highly compensated professionals) before spending money on anything.
I know of no reason anyone should take my financial musings seriously. At best I am a dedicated amateur providing a bit of investment-related insight and entertainment, at worst an amusing diversion.
My wife, Fran, and I may at times own shares of some of the assets mentioned here. But neither of us receive any benefit from reference to them, unless you count the mutual misery when we get it wrong, or the opportunity to gloat when we get it right.