Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.

A few moments ago my Precision Castparts (PCP) holding hit one of my appreciation targets.  As you may recall, I use 30, 60, 90, 120, then 180, 240, 300, 360, 450, 540%...etc. targets to sell 1/6th of my holdings.   I sold 20 shares of my 120 share position (leaving 100 shares in my Trading Account) at a price of $90.20.  I had purchased these shares 10/24/06, about 3 months ago, at a cost basis of $69.05.  It has been an excellent performer for me!

This sale represented a gain of $21.15/share or 30.6%.  Since I am at 14 positions, under my maximum of 25, this also gives me a "permission slip" to add a new position to the account.

As I like to joke, that 'nickel' is already burning a hole in my pocket.

Thanks so much for stopping by!

Bob

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.

One of my favorite things about writing a blog is reading and responding to questions and comments from readers.  And when I get a letter from 'overseas', then it is all the more special.  And when a reader like Dror is kind enough to write more than once...well it is just special!  O.K., enough of the sentimental stuff.  Let me share with you what Dror wrote and what my thoughts are on the subject.

Dror's letter:

"Hi Bob,

 

I've been wondering what is your strategy on stocks that do not get out of your -8% and the +30% thresholds for a few months...

When will you take them out of your portfolio, will you wait a quarter, two, or wait indefinitely until some threshold is broken?

 

Bob, I really appreciate your perseverance on sharing your thoughts and strategies with everybody.

 

Thanks so much,
  Dror (From Israel, yes ;-)"

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any decisions based on information on this website.

Just before the close of trading my Wolverine World Wide (WWW) hit the first sale point at a 30% appreciation target.  Being under my maximum holdings with only 13 positions out of my potential 25, this gave me a "permission slip" to add a new position.  Checking the top % gainers list, I saw that Hologic (HOLX), another old favorite of mine had hit the list.  I checked and saw that they came in with strong earnings and had raised guidance....both big positives for a stock.

Shortly before the close of trading (at 3:55 pm exactly :)), I went ahead and purchased 120 shares at $55.49.  

Thanks again for stopping by and visiting.  I try very hard to share with you all of my trades and my thinking behind it as I work to refine my own strategy!

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website!

The market really closed on a tear today!  I had a couple of stocks close to a sale and Wolverine World Wide decided to cross that 30% threshhold a few moments ago.  I sold 40 shares of WWW at $30.84/share shortly before the close of the trading day.   I had purchased 240 shares at a cost basis of $23.55/share on 4/19/06, just under a year ago, and with today's price move, the stock passed a 30% appreciation target, and I unloaded 1/6th of my holding, or 40 shares.  This sale at $30.84 represents a gain of $7.29/share or 31%.  On the upside, I plan on selling another 1/6th of my holdings if the stock should appreciate to a 60% appreciation target, otherwise, after a single sale, I shall move my 'mental stop' up to break-even or $23.55...at which time I would be unloading all of my remaining shares.

This gave me a "permission slip".  I had earlier noted that another favorite of mine, Hologic (HOLX) was on the top % gainers....and I bought some...I shall write this purchase up as a separate blog entry!

Thanks so much for stopping by and visiting!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice! As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.  

You probably knew that 'nickel' wouldn't stay long in my pocket! Having a 'permission slip' to buy a new position, after selling a portion of my Kyphon stock, I went quickly over to the top % gainers list.  I came across an old favorite of mine, a stock that is in my 'vocabulary' of stocks, Harris Corp, which as I write is trading at $49.78, up $2.03 or 4.25% on the day.  A few moments ago I purchased 120 shares of HRS at a price of $49.96 for my 'Trading Account'. 

Well, there goes that nickel!  Anyhow, I am now up to 13 positions and shall be monitoring all of my stocks to see if we need to do anything else.  Thanks again for stopping by and feel free to leave any comments you might have on the blog or you can email me at bobsadviceforstocks@lycos.com.

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As alway, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.

My Kyphon stock made a nice move higher today.  As I write, it is trading at $47.80, up $2.75 or 6.10% on the day.  A few moments ago, I made my second sale of Kyphon (on this particular purchase), selling 1/6th of my 150 shares or 25 shares at a price of $47.83.  My Kyphon shares were purchased (this round...I had one other purchase and sale of Kyphon), on 5/20/05, with a cost basis of $29.21.  Thus, I had a gain of $18.62  or 63.7% on my shares, triggering my second partial sale of 1/6th of my holdings.

I had earlier (7/8/05) sold 50 shares (which at that time was a 1/4 sale of my position), at a price of $37.98, which worked out to a gain of $8.77 or 30%.

If you are new to my blog, basically I sell my positions quickly if they hit a targeted loss (for instance an 8% loss after an initial purchase) and sell my appreciating stocks slowly and partially as they appreciate.  My current targets are at 30, 60, 90, 120, 180, 240, 300, 360, 450, 540%....etc. appreciation levels.  

If I am under my full portfolio (for me 25 positions), then this entitles me to add a new position, as long as the new stock meets the same criteria I use on this blog....on the top % gainers list, etc.  Since I am at 12 positions, I now have a "permission slip" to go and buy a new stock. 

That nickel is burning a hole in my pocket already!

Thanks so much for visiting!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.  Please give me a first name and a location which makes it all more interesting for all of us.

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.

Today seemed like a good day to catch up with some 'housekeeping' around here!  One thing I haven't done for a few months is to review my holdings in an entry.  I have been writing over on MSN in the Jubak's Refugees area occasionally.  I discussed my strategy and have started reporting on my progress, or lack thereof, on a regular basis.  This is what I wrote this evening:

"Hello Jubak Refugees,

Another 3 months have passed since I updated my trading portfolio with all of you. I continue to use my same strategy and continue to write at Stock Picks Bob's Advice.

This analysis is as of the close of trading January 26, 2007.

I am currently at 12 positions. My maximum is 25 and my minimum is 6.

The account net worth stands at $39,618.32. I am currently at 53.59% margin equity, with a margin debit of $34,299.28. The market value of securities being held stands at $73,917.60.

Current Positions (# shares, date of purchase, closing stock price, cost basis, % gain (loss))

Bolt Technology (BTJ) (300 shares, 1/12/07, $20.42, $17.44, 17.11%)

Coach (COH) (71 shares, 2/25/03, $43.84, $8.33, 426.21%)

Cytyc (CYTC) (225 shares, 1/29/04, $28.14, $14.86, 89.42%)

Kyphon (KYPH) (150 shares, 5/20/05, $44.36, $29.21, 51.84%)

Morningstar (MORN) (167 shares, 11/22/05, $46.02, $32.57, 41.28%)

Precision Castparts (PCP) (120 shares, 10/24/06, $85.97, $69.05, 24.50%)

Quality Systems (QSII) (88 shares, 7/28/03, $41.87, $7.75, 440.34%)

ResMed (RMD) (150 shares, 2/4/05, $51.73, $29.87, 73.19%)

Starbucks (SBUX) (50 shares, 1/24/03, $33.88, $11.40, 197.07%)

Meridian Bioscience (VIVO) (210 shares, 4/21/05, $29.45, $11.13, 164.64%)

Ventana Medical Systems (VMSI) (188 shares, 4/16/04, $41.07, $23.47, 74.99%)

Wolverine World Wide (WWW) (240 shares, 4/19/06, $27.70, $23.55, 17.64%)

Since my last post on October 8, 2006, the following trades have occurred: I sold 17 shares of Coach (COH) at $38.73 on 10/24/06 and bought 120 shares of Precision Castparts (PCP) at $68.96 on 10/24/06. I withdrew $11,000 out of my margin balance to pay for a roof on 11/10/06. On 1/12/07, my Coach (COH) stock hit another targeted sale point and I sold 14 shares at $45.82. I then bought 300 shares of Bolt Technology (BTJ) at $17.40. I am now depositing $300/month into the account and writing checks for $575 for a car payment.

I finished up 2006 with net realized gains of $5,460.82. I had a net short-term loss of $(5,237.30) and net long-term gains of $10,698.12.

As of 1/26/07, I have $513.87 of net realized gains consisting entirely of long-term gains in 2007. I have paid $202.69 in interest in 2007 as well.

Also, as of 1/26/07, the account has a net unrealized gain of $28,511.49.

I hope this is all helpful as I have been posting this progress report here actually for a couple of years now! If you are interested, I post regularly on my blog, Stock Picks Bob's Advice at

Thanks again!

Wishing all of you well.

Bob"

I hope that this update is helpful for all of you readers here as well!  I have been far more disciplined the last few years and actually have slowed down my trading as I concentrate on only trading when I have the indicator from my own portfolio to do so!  

If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.  I also have a podcast website which you might wish to visit.  

Have a great week trading!

Bob

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website. 

A couple of months ago I started a new entry called "long-term review".  These are an examination of my earlies stock picks.  This blog started back on May 12, 2003, and since then I have posted over 1,300 entries.  To get a better feeling about how these stock picks are doing, I am trying to review these picks in order and see how they are doing today.  Some of these stocks have been acquired or are otherwise no longer publicly traded.  I shall be restricting myself to those stocks which still trade for the purposes of this review.  also for these reviews, I plan on restricting myself to the latest quarterly report, the Morningstar.com evaluation, and a point and figure chart.

On May 14, 2003, I posted HealthExtras (HLEX) on Stock Picks Bob's Advice.  This is what I wrote:

"Wednesday, 14 May 2003

May 14, 2003 HealthExtras

It is 10 minutes before the close of trading and scanning the list again a new name has popped up for consideration. I do not own this stock and am not currently planning to purchase it....but may in the future! HealthExtras...at $5.70 up $.77 or 15.62%. Wow....a blazing pop in this small (!) company. Looking at the news....through Yahoo....we find that earnings were just reported...revenue of 91.7 million, a 68% increase over the prior year and net income of $1.9 million....a 221% increase from the prior year (!). Company is in pharmacy benefit management...as everyone knows a very HOT area...just listen to the politicians talking about benefits for seniors, etc. Checking out Morningstar, we find sequential growth in revenue....from 5.3 million in 1999, 44.2 million in 2000, 124.4 million in 2001, and 226 million for the trailing 12 months. What is there NOT to like? Probably SHOULD buy this myself....but for now....my portfolio is FULL..and will buy only when one of my stocks hits the 40-50% gain I am planning on....then can add a new position. Good luck. Bob

P.S. the symbol for this one is HLEX....tell me what you think."

HLEX closed at $24.92 on January 26, 2007, for a gain on that pick of  $19.22 or 337.2% since posting.  I do not own any shares or options on this stock.

How did they do in the latest quarter?

On November 6, 2006, HealthExtras reported 2006 3rd quarter results.  Revenues for the third quarter 2006 totaled $363.1 million, a 118% incrrease over 3rd quarter 2005 results of $166.8 million.  Net income worked out to $8.8 million, or $.21/share, up 40% from comparable 3rd quarter 2005 earnings of $6.3 million or $.15/share.  The company failed to meet expectations of $.23/share on revenue of $363.9 million.

How about longer-term results?

Looking at the Morningstar.com "5-Yr Restated" financials on HLEX, we can see that revenue has steadily increased from $118 million in 2001 to $695 million in 2005 and $860 million in the trailing twelve months (TTM).

Earnings, which were at a loss of $(.23)/share in 2001, turned profitable at $.42/share in 2002, dipped to $.30/share in 2003, but have improved steadily since with $.45/share in 2004, $.56/share in 2005 and $.56/share in the TTM.

The company has been issuing shares with 29 million shares in 2001, 39 million in 2005 and 41 million in the TTM.  While increasing shares by about 50%, they have actually increased revenue by more than 400% during that time period.

Free cash flow is positive with $23 million in 2003 and $27 million in 2005 with $19 million in the TTM.

The balance sheet looks good to me with $69.9 million in cash and $125.8 million in other current assets.  This combined $195.7 million in current assets is more than adequate to cover both the $115.3 million in current liabilities and the $15.2 million in long-term debt combined. 

What does the chart look like?

Looking at the "Point & Figure" chart on HLEX, we can see the steady increase in price from $3.75 in 2002 to a high of $37 in March, 2006.  The stock has pulled back since but appears to have additional strength.

 

Summary: What do I think about this stock?

Let's summarize a few things.  Basically they had a terrific recent quarter, although expectations were so high that they failed to mee the even higher expectations.  This early pick has been a great one for me with the stock moving steadily higher the past several years.

If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Bob
 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website. 

I try to do several things on this blog.  And unfortunately, as an amateur the organization here could be improved :).  But one of the important things I like to do is to share with you my actual trading portfolio, the buys, the sales, the successes and the failures.  It is through this that I maintain the discipline to continue with my grand investing experiment.  It is knowledge that I am responsible to all of you that has motivated me to continue to exercise discipline in my trades.

Besides reporting on my trades, I like to examine a position in my portfolio every 2 to 3 weeks.   On January 6, 2007, I discussed my Kyphon Holding on Stock Picks.  Going alphabetically through the stocks I own in this portfolio brings me to Morningstar (MORN). 

I purchased 200 shares of Morningstar stock (MORN) on 11/22/05 at a price of $32.57/share.  I posted a review of Morningstar that same day on the blog. 

On February 16, 2006, I sold 1/6th of my position or 33 shares when the stock was trading at  $42.94/share for a gain of $10.37 or 31.8% since my purchase.  Morningstar closed at $46.02 on January 26, 2007, for a gain of $13.45 or 41.3% on my remaining 167 shares of MORN.

As per my plans, I will be selling all of my remaining shares if the stock declines to the purchase price or $32.57/share.  On the upside, I plan on selling 1/6th of my remaining shares or 27 shares if the stock should appreciate to a 60% gain or 1.60 x $32.57 = $52.11/share. 

Let's take another look at this stock and see if it still fits into the criteria I use on this blog.

What exactly does this company do?

According to the Yahoo "Profile" on Morningstar, the company

"...provides independent investment research to investors worldwide. It offers Internet, software, and print-based products for individual investors, financial advisors, and institutional clients, as well as asset management services to advisors and institutions. It operates in three segments: Individual, Advisor, and Institutional."

How did they do in the latest quarter?

On November 2, 2006, Morningstar reported 3rd quarter 2006 results. Revenue for the quarter ended September 30, 2006, came in at $81.8 million, a 44% increase from the $56.9 million reported in the third quarter of 2005.  Net income was also up strongly at $13.5 million, or $.29/diluted share, up from $7.5 million or $.17/diluted share in the prior year same period.  The company beat expectations of $.28/share.

What do their longer-term financial results look like?

Reviewing the Morningstar.com "5-Yr Restated" financials (!) on Morningstar, we can see that revenue has steadily increased from $91 million in 2001 to $227 million in 2005 and $289 million in the trailing twelve months (TTM)

Earnings, which were showing losses from 2001 to 2003, turned positive in 2004 at $.21/share, increased to $.70/share in 2005 and $1.04 in the TTM.

No dividend is paid and the number of shares has been fairly steady with 39 million in 2001 and 39 million in 2005, with a slight increase to 42 million in the TTM.

Free cash flow has been positive and growing with $21 million in 2003 increasing to $41 million in 2005 and $81 million in the TTM.

The balance sheet looks solid with  cash of $124.3 million and $64.7 million of other current assets, a total of $189 million in current assets is enough to pay off both the $148.3 million in current liabilities and the $8.6 million in long-term liabilities combined.  The current ratio works out to a healthy 1.27.

What about some valuation numbers?

Checking the Yahoo "Key Statistics" on Morningstar, we can see that this is a mid cap stock with a market capitalization of $1.92 billion.  The trailing p/e is rich at 44.29, with a forward p/e (fye 31-Dec-07) estimated at 31.09.  No PEG ratio is reported.

Reviewing the Fidelity.com eresearch site for some valuation numbers, we can see that the Price/Sales (TTM) ratio is a bit rich at 6.53 relative to the industry average of 2.81.  Profitability, however, is higher than the average with a Return on Equity (TTM) of 23.14%, compared to the industry average of 12.06%.

Finishing up with Yahoo, we find that there are 41.77 million shares outstanding with 10.26 million shares that float.  As of 1/9/07 there were 834,920 shares out short representing 7.3% of the float or 12.1 trading days of volume.  Using my '3 day rule' on short interest, this 12 days of short interest has the potential of a short 'squeeze' if Morningstar can report another quarter of earnings results ahead of estimates.  That announcement should be out relatively soon, and it will be interesting to observe the results.

Finally, as noted, no stock dividends and no stock splits are reported on Yahoo.

What does the chart look like?

Reviewing the "Point and Figure" chart from StockCharts.com on Morningstar, we can see that the stock moved strongly higher from the $19 level in May, 2005 to a high of $4 in May, 2006.  However, the stock corrected after that, pulling to a low of $33 in August, 2006.  Since then the stock has broken through resistance and is trading once again just under its high at $46.02.

Summary: What do I think about Morningstar?

As you know, this is a holding in my Trading Portfolio.  Even so, I like this stock.  I use the Morningstar.com website regularly for these analyses.  Besides that, the latest quarterly report was very strong, the Morningstar.com 5-yr page is solid, valuation is a bit rich, and the chart looks just fine to me!  I shall sit tight with my holdings; waiting for either an additional sale at a gain or a retracement and sale.  

Thanks again for stopping by! I hope these discussions of different stocks is helpful to you!  I would love to hear more from readers of this blog.  You can leave comments under each entry or drop me a line at bobsadviceforstocks@lycos.com.   If you get a chance, drop by and visit my Stock Picks Podcast site! Have a wonderful week!

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.

Once again I ask myself where the week went and here it is Saturday afternoon and I need to get around to reviewing some past stock picks!  Each weekend, I try to review stocks from consecutive weeks on the blog.  These reviews assume a "buy and hold" strategy and estimate what might have happened if I had bought equal $ amounts of each of the stocks discussed that week. 

In reality, I advocate and employ a disciplined management strategy which involves selling losing stocks quickly and completely at small 8% losses, and selling my gaining stocks slowly and partially at targeted appreciation levels.  This difference in strategy would certainly affect investment returns.

I have started including "point & figure" charts on each of the stocks reviewed with the point of the "pick" identified for review.  My "thumbs-up" or "thumbs-down" is a simple assessment on each earnings report.  I simply require increased revenue and earnings for each pick to get that "thumbs-up".  It does not mean that I believe that the stock is still a good investment; this just indicates my basic reaction to the earnings news.

Let's take a look at those three stocks which were reviewed during that week in September, 2005.  Much of my attention at that time was directed to New Orleans and Katrina where I had many of my wife's family affected.  It is hard to believe that so much time has now passed and so little has been done to assist that once great American city. But that is another story for another blog.

On September 21, 2005, I posted FedEx (FDX) on Stock Picks Bob's Advice when it was trading at $83.15.  FedEx closed at $109.89 on January 26, 2007, for a gain of $26.74 or 32.2% since posting.

On December 20, 2006, FedEx reported 2nd quarter 2007 results.  Revenue for the quarter came in at $8.93 billion, up 10% from $8.09 billion in the same quarter last year.  Net income came in at $511 million, up 8% from the $471 million last year.  Earnings came in at $1.64/share (including one time expenses), up from $1.53/diluted share last year.

On September 22, 2005, I "revisited" Comtech Telecommunications (CMTL) when it was trading at $40.65.  CMTL closed at $35.00 on January 26, 2007, for a loss of $(5.65) or (13.9)% since posting.

On December 4, 2006, Comtech (CMTL) announced 1st quarter 2007 results.  Although beating expectations, sales for the quarter decreased to $97.1 million from $106.6 million in the same quarter last year. GAAP Net income was $10.8 million or $.41/diluted share for the quarter ended October 31, 2006, down from $11.5 million or $.43/share in the same quarter last year.

Finally, on September 23, 2005, I "revisited" Thor Industries (THO) when it was trading at $33.41.  Thor closed at $45.71 on January 26, 2007, for a gain of $12.30 or 36.8% since posting.

On November 27, 2006, Thor reported 1st quarter 2007 results. For the quarter ended October 31, 2006, sales dropped 4% to $727.7 million from $761.3 million in the same quarter the prior year.  Net income was $32.6 million down 25% from last year's $43.4 million.  Earnings came in at $.59/share down from $.77/share.

So how did I do with these three stocks?  Well, two made nice gains and one had a loss for an average gain of 18.4%.  Not too shabby actually!

Anyhow, I have to run!  So have a great weekend everyone and drop me a line at bobsadviceforstocks@lycos.com or simply leave your questions or comments right on the blog.

Bob