Since our last prognosis on TSO, we have recently sold TSO, bought it again, sold it, then have recently bought it again. We originally bought TSO at a price of $17.37 per share. Then we subsequently sold it at $18.45 per share for a percentage increase of 8.5% or $125.72. The trade time of this was roughly 1 month.
After a drop over the next three days, we bought TSO back. Our recent trade allowed us to buy 5 additional "free" shares. We bought it at a share price of $17.42. After our purchase, there was a quick run-up. Due to recent market conditions, and the volatility of the market, we sold it four days later at a share price of $18.73 or a percentage increase of 7.5% or $117.09.
Yesterday (9/29/08) just after the announcement of the rejected bailout (the second one), with stocks plummeting and hammering TSO, we found a buying opportunity in TSO once again. This allowed us to get 100 shares for essentially the same amount of investment as the times before at a share price of $15.46. Currently the we sit at a 6.63% increase in stock price from the slight recovery after the big drop.
The reason we keep playing TSO, from our opinion, oil prices have stayed low allowing them to make profits from the increase in the crack spread. We feel their lowered stock price is a result of market reasons and not company reasons. Therefore we feel the company has been unfairly beaten down due to surrounding effects of the credit market. Our opinion is their Q3 profits will be significantly improved from Q2. We would like to continue to hold this company until earnings are released late October. If we do have another quick run-up of roughly 15%, we would more than likely consider selling and buying back at a discount. Although, we would have to consider the news pushing the stock price higher and the relative closeness to their earnings report (one which we feel will be favorable).
As always, questions comments and feedback is always welcome.
Tuesday, September 30, 2008
Tuesday, September 16, 2008
Monday, September 1, 2008
Obama vs. McCain
These are the sectors I think will be most affected by the next election:
If Obama wins, infrastructure/construction stocks will do well. Alternative energy investments will also be winners. And the technology sector as Obama is a proponent of universal internet access. Smaller telecoms could also do better as the FCC will want more regulations for big phone companies. Retailers with lower income customers will conceivably do better under Obama. An Obama presidency could also potentially be good for biotechnology companies that research stem cells.
If McCain wins, it will be better for the health sector, especially big insurers whose margins will be squeezed by universal health care that Obama favors. Oil and gas companies would be better under a McCain presidency. Especially nuclear energy as McCain believes nuclear is the solution for the energy crisis. Upscale retailers will do better with lower taxes on upper income brackets. Large telecom stocks are also considered to do better under McCain with an FCC that be more accepting to acquisitions. A McCain presidency could also be better for financials because he generally favors less regulation and would avoid new strict rules. Also, the McCain presidency would benefit defense companies since Obama could cut the defense budget down the road with a withdrawal from Iraq.
If Obama wins, infrastructure/construction stocks will do well. Alternative energy investments will also be winners. And the technology sector as Obama is a proponent of universal internet access. Smaller telecoms could also do better as the FCC will want more regulations for big phone companies. Retailers with lower income customers will conceivably do better under Obama. An Obama presidency could also potentially be good for biotechnology companies that research stem cells.
If McCain wins, it will be better for the health sector, especially big insurers whose margins will be squeezed by universal health care that Obama favors. Oil and gas companies would be better under a McCain presidency. Especially nuclear energy as McCain believes nuclear is the solution for the energy crisis. Upscale retailers will do better with lower taxes on upper income brackets. Large telecom stocks are also considered to do better under McCain with an FCC that be more accepting to acquisitions. A McCain presidency could also be better for financials because he generally favors less regulation and would avoid new strict rules. Also, the McCain presidency would benefit defense companies since Obama could cut the defense budget down the road with a withdrawal from Iraq.
Monday, August 18, 2008
New Purchases
First and foremost, I would like to address the latest post. I have a few concerns with Meredith. First off, the name? Is she 65 and just looking real young? Second off, I need a little more of a body shot before I define her as hot.
Anyhow, on to the actual topic of my post. As of today 8/18/2008, we bought Goldman Sachs and Tesoro. Goldman Sachs was a company we liked previously when it was coupled with a short of another financial. We took the best of breed (GS) and shorted it's competitor. We actually recently sold GS at $180, and we have now bought it back at a discount of roughly $18 a share. This allowed us to actually get a "share for free". We are looking for another trend from GS. They have currently been bouncing between about $160 and $180 fairly consistently. They also appear to be the only financial stock to be unharmed by the financial's downturn. We like the best company in the sector, especially at these levels.
The second company we bought was Tesoro. This is a very large refiner of crude oil. After the large run up of oil over the last year +, we feel they have lost their crack spread and are now poised to take back their margins. Oil has been progressively getting lower since the beginning of August, and we would like to ride TSO up to a fair market value.
This has been a synopsis of our thought process on what we recently bought and why. Any questions or concerns you see? Let us know. The more perspective there is the clearer the picture. Is clearer a word? How about more clear.
Anyhow, on to the actual topic of my post. As of today 8/18/2008, we bought Goldman Sachs and Tesoro. Goldman Sachs was a company we liked previously when it was coupled with a short of another financial. We took the best of breed (GS) and shorted it's competitor. We actually recently sold GS at $180, and we have now bought it back at a discount of roughly $18 a share. This allowed us to actually get a "share for free". We are looking for another trend from GS. They have currently been bouncing between about $160 and $180 fairly consistently. They also appear to be the only financial stock to be unharmed by the financial's downturn. We like the best company in the sector, especially at these levels.
The second company we bought was Tesoro. This is a very large refiner of crude oil. After the large run up of oil over the last year +, we feel they have lost their crack spread and are now poised to take back their margins. Oil has been progressively getting lower since the beginning of August, and we would like to ride TSO up to a fair market value.
This has been a synopsis of our thought process on what we recently bought and why. Any questions or concerns you see? Let us know. The more perspective there is the clearer the picture. Is clearer a word? How about more clear.
Buffet's Bet Against Hedge Funds
http://money.cnn.com/2008/06/04/news/newsmakers/buffett_bet.fortune/index.htm
Warren Buffet made a $1 million bet that the S&P 500 will have a higher return than a fund of funds picked by hedge fund manager Protege Partners. We won't know for 10 years what the outcome will be, but if you're like me you believe that an actively managed portfolio will beat an index fund especially during economic downturns like we are having now that give investors who short stock an advantage.
Warren Buffet made a $1 million bet that the S&P 500 will have a higher return than a fund of funds picked by hedge fund manager Protege Partners. We won't know for 10 years what the outcome will be, but if you're like me you believe that an actively managed portfolio will beat an index fund especially during economic downturns like we are having now that give investors who short stock an advantage.
Portfolio Weighting
The weighting of the portfolio is as follows as of 8/18/08:
Goldman Sachs 15% (New position)
Tesoro 17.05% (New position)
Apple 16.26%
HRP Properties 10.78%
Sadia 13.7%
Visa 15.63%
Cash 11.57%
More to come....
Goldman Sachs 15% (New position)
Tesoro 17.05% (New position)
Apple 16.26%
HRP Properties 10.78%
Sadia 13.7%
Visa 15.63%
Cash 11.57%
More to come....
Hot for an analyst
Meredith Whitney, a bank analyst at Oppenheimer, whose claim to fame is being critical of Citi before it tanked
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