It pains me that I don't have the time to share as many long/short public market ideas on this blog as I once did. To be honest I'm probably not the best person to be listening to when it comes to those ideas these days as my head just isn't in that game.
But I do find time to review what's going on at a deeper level once or twice a month. I would be foolish to disconnect myself from that process of staying up to date with what's working in the market and what's on its way out. Everyone, regardless of whether you trade or not, should be paying attention to trends in the price of public market assets and indices. Private market trends are important as well, maybe even more important these days, but more difficult to follow.
At the end of 2011 I wrote about my 10 Favorite Stocks Going Into 2012, so before I do the same for the coming year, here's a little review.
- Under Armour (UA) +45%, this thing just keeps chugging, it's still so early for this company which I believe is the next Nike (NKE). I wear their underwear, their compressions shorts, cold gear to go running, it's just all amazing, well-made durable high quality stuff and people are willing to pay for that. Under Armour is premium brand and that stock is going to trend well for a long time.
- MasterCard (MA) +28%, payments, payments, payments, payments. How many times do I have to say it, payments are being driven by all of the innovation in the private market with Square, Dowalla, and all of the other payment startups. Mastercard has to buy a few of these guys, and the stock isn't anywhere near stopping.
- Sourcefire (FIRE) +38%, I still love the internet security trend, but this stock has gotten taken down a bit lately. I would stick with it until a break of that $40 level and then call it a day.
- On Assignment (ASGN) +72%, I did call to exit the stock after it gapped up huge in mid March, and then called to get back in September 19th before it exploded again, basically at the same price exited in March. This was my play on the job market as businesses in the healthcare sector needed to staff up as demand has exploded but don't want to hire full time employees. Why not outsource? This company has a lot of room left, big win.
- Wabtec (WAB) +28%, steady as she goes, the best name I like in the transport sector, they make railcar technology.
- HealthStream (HSTM) +27%, Healthstream was a bigger winner earlier in the year but it's a long term play that I would stick with here. I like the space they are in and how they've executed.
- Short Strayer Education (STRA) +41%, but I did call to exit the short earlier this month for a profit of 54%. What more can I say, Strayer is an evil company and they got their assess handed to them as I thought they would. Market justice is oh so sweet. If you bought the leaps last year as I proposed, you should have closed them earlier this month and had some champagne. Don't get greedy, it's hard to root against companies, take the money and run.
- CEVA (CEVA) -50%, wow what a disaster, I got this one completely wrong but did call for a full exit after the May earnings report debacle, but still down -30%, ouch.
- IBM (IBM) +4%, was better earlier in the year but I'm honestly disappointed in their top line growth, thought it would be much better. IBM is still the only company I would gladly own for the next 10 years without looking at once. One word, Watson.
- LivePerson (LPSN), Flat, but I did call to exit the stock after the bad earnings report in August, so +28%. I think the wave of acquisitions in this industry just petered out and left LivePerson in no man's land.
- Newpark Resources (NR) -18%, I did call for a full exit though after the second big bearish engulfing day post failed long term breakout, you would have exited about flat. Not sure why this one was a dud, it had all the makings of a home run.
So overall we had a great year of picks against a tough market for long/short equity, save for last winter/spring which was gangbusters.
Let's see if we can do it again next year, post forthcoming.