NOTE: Results include dividends and returns of capital to shareholders when applicable.
General Motors (NYSE:GM) was recommended on 4/29/05 at $26.75. It closed 12/29/06 at $30.72. This position is +24.2%. Fairfax Financial (FFH) was recommended on 5/3/05 at $132.50. More shares were purchased for an average cost of $123.16.It closed 12/29/06 at $198.50. This position is +62.3%. 3i Group was recommended on 5/17/05 at $15.06 (adjusted for two subsequent reverse stock splits). It closed 12/29/06 at $19.75. This position is +59.2%. Nikko Cordial ADR was recommended on 5/26/05 at $8.64 (adjusted for a 5-for-1 ADR split). It closed 12/29/06 at $11.46. This position is +41.3%. Imagistics International was recommended on 6/30/05 at $26.60. It was bought by Oce, N.V. later in 2005 for $43.00 cash. This position closed out +58%. Molson Coors (NYSE:TAP) Class B was recommended on 6/13/05 at $60.35. It closed on 12/29/06 at $76.44. This position is +29.8%. DirecTV (NASDAQ:DTV) Group was recommended on 7/21/05 at $15.50. It closed on 12/29/06 at $24.94. This position is +60.9%. Liberty Media Series A (NASDAQ:LINTA) was recommended on 8/4/05 at $8.52. The company then distributed to shareholders two tracking stocks, Liberty Capital and Liberty Interactive, this year. I view those two as a single position in the portfolio. Capital closed 12/29/06 at $97.98 and Interactive closed at $21.57. This position is +20.8%. USA Mobility (NASDAQ:USMO) was recommended on 8/24/05 at $26.34. It closed on 12/29/06 at $22.37. This is a prime example of why including payouts is important. This position is +4.5%. Comcast Class A Special (NASDAQ:CMCSA) was recommended on 11/28/05 at $26.73. It closed on 12/29/06 at $41.88. This position is +56.7%. Deckers Outdoor (NYSE:DECK) was recommended on 10/18/05 at $20.92. It closed on 12/29/06 at $59.95. This position is +186.6%. CBS Class B (NYSE:CBS) was recommended on 2/16/06 at $25.61. It closed on 12/29/06 at $31.18. This position is +23.9%. Media General (NYSE:MEG) Class A was recommended on 3/21/06 at $47.05. More shares were purchased for an average cost of $44.76. It closed on 12/29/06 at $37.17. This position is -15.6%. Takefuji Corp. was recommended on 4/20/06 at $62.50. More shares were purchased for an average cost of $57.30. It closed on 12/29/06 at $39.53. This position is -29.3%. Mueller Water Products (NYSE:MWA) Series A was recommended on 7/19/06 at $15.88. I nibbled on a few more shares for an average cost of $15.64. It closed 12/29/06 at $14.87. This position is -4.8%. BCE Inc. (NYSE:BCE) was recommended on 8/6/06 at $23.01. It closed 12/29/06 at $27.00. This position is +18.6%. ArmorGroup International (NYSE:ARG) was recommended on 9/7/06 at $1.03. It closed on 12/29/06 at $1.50. This position is +47.9%. Walter Industries (NYSE:WLT) was recommended on 9/27/06 at $43.21. It closed on 9/29/06 at $27.05. Mueller Water Products Series B was spun off from Walter and closed on 12/29/06 at $14.90. Taken as a single position, these two combine for +19.7%.
In all, my stock picks have averaged a gain of 36.9%..
Four points need to be made.
First, these are not “annualized” results or year-to-date results. These are simply how the stock picks have performed since being recommended. I will post YTD results next.
Second, as stated, these results include dividends and returns of capital to shareholders. I did this because not doing so distorted the performance of my stock picks -- especially in cases like 3i Group and USA Mobility. The only holdings that pay no dividend are DirecTV, Comcast, Deckers Outdoor, and the Liberty Media tracking stocks.
Third, these are not “audited” results. They’re just my calculator and me and I’m subject to correction.
Fourth, I live in the US so I track my portfolio in US Dollars. Someone following my picks and residing in Canada, the UK or another country may see results better or worse than mine.
As a group, the 17 stocks making up the portfolio’s current holdings achieved an average gain of 27.5% through the fourth quarter of 2006. That compares to the S&P 500 being up 13.6% for the year, according to WSJ.com. For reasons given in my previous post, I am now factoring in dividends and returns of capital to shareholders in my results. I don’t believe the S&P 500 result for 2006 reported on WSJ.com includes dividends, though the report didn’t say one way or the other.
Here’s how each of my holdings have performed in 2006:
Deckers Outdoor +117.1% DirecTV Group +76.6% General Motors +63.3% Comcast Class A Special +63% ArmorGroup International +47.9% Fairfax Financial +39.3% 3i Group +32.6% Liberty Media (Liberty Capital/Liberty Interactive) +30.8% CBS Class B +23.9% Walter Industries/Mueller Water Series B +19.7%% BCE Inc. +18.6% Molson Coors Class B +16% Mueller Water Products Series A -4.8% USA Mobility -6.1% Media General Class A -15.6% Nikko Cordial ADR -25.3% Takefuji Corp. -29.3%
Regular readers know I’ve taken partial profits in Deckers Outdoor, Comcast, Fairfax and Nikko Cordial. And that Nikko Cordial figure shows just how misleading statistics can sometimes be. The ADRs are down more than 25% for the year, yet the position has gained more than 40% since being recommended in 2005. So it’s been a winner for the portfolio, even with its recent regulatory troubles in Japan.
Takefuji remains a big loser so far. Yet I remain confident -- or hardheaded -- and still feel it will ultimately prove a sound investment. Closer to home, Media General is down but I’m confident its convergence strategy can payoff in due time.
The media related stocks have all done well, as they gained favor with investors. Other big contributors include Deckers, ArmorGroup, 3i Group and BCE. GM is up big for the year, but as you’ve read me say repeatedly, I haven’t done nearly as well personally (I bought a chunk of the stock before launching this blog).
That’s it for now. I’m delighted with the performance of these stock picks as a group for the year. But I won’t do nearly that well on a regular basis, so let’s take what we can get. I’m content with all these holdings, if not the share price performance in every case. Let’s see what happens in 2007.