It has been about 16 months since I got my first Seeking Alpha article published. I was never really a writer previously, and if you ask some, I am still not much of a writer, but I have always enjoyed being able to put information together and share my opinion. I did not initially know how to become a contributor and thought it was great that any investor from a hedge fund manager to a 20-year old novice in the game had a chance to get recognition that otherwise just was not available. Of course, not every article is going to please every single person, but the range of information, ideas and knowledge - and the wide-ranging types of investors - on Seeking Alpha is above and beyond anything else that is out there.
After not writing for a few months due to a big blunder and learning some humility along the way, I decided to start writing again as I do enjoy it and I get a lot out of it, but I also hope that readers see value in it as well. It also got me thinking of all of my writings, investments, recommendations, and overall experience with Seeking Alpha. It got me wondering how others would have done by following my recommendations. I can remember the first time (and actually still) being extremely excited to be able to see my article on some of the major financial sites such as Nasdaq, Yahoo, Thestreet.com, etc. On top of the recognition, writing the articles has helped me learn along the way as it pushes me to dig for more information, not be lazy, and basically, as another investor stated, it helps you to formulate your ideas together in a more well thought-out manner.
In terms of investing, I have been more of a short-term trader, not daily, but less than 6 months, but I also like to find the companies that have a quality long-term opportunity. My style and advice also entails a lot of risky stocks along the way, so there are going to be a lot of ups, downs, and overall volatility with many of my investments. I like to invest in the triple leveraged ETFs, and small-cap stocks, which if played correctly and if enough research is done, an investor can do very well, but also be bitten along the way and I have learned that, for sure. It is important to not get away from your rules and remember to also take profits off the table. That is also why diversification can never be stressed too much. Overall, it is difficult to gauge my success with the articles as many investors are different, sell at different times, buy at different times, etc. Also, I made some specific recommendations in some, buy on certain drops, sell on certain pops, etc. Here is an overview of the last 16 months of recommendations.
Orient Paper (ONP)
This is where it all began for me on Seeking Alpha, back in August 2010. Around that time, actually about a month prior, was the introduction of Muddy Waters. Of course, I thought how ridiculous its report was, nothing made sense, and I thought it was not done in legitimacy, but strictly to taint a company, purely for its own self-interest. In the end, myself and other longs were incorrect as the whole U.S.-listed China small-cap space has fallen apart and many companies have been delisted or just outright stopped doing anything for shareholders. There was a battle between the shorts and the longs and the longs had no idea at that time what was in store for the China space, which has gotten decimated since. To make a long story short, the shorts won by a landslide.
I am not going to get into the whole story, but Orient Paper defended pretty hard and still seems to be hanging on. While many of us, myself included, thought we could dig up information and present the positive case, until it was too late, it was above our heads and unfortunately, it took too long to realize. I have come to find it is just not worth investing in the China small-cap space, and apparently with Focus Media (FMCN) getting hit by Muddy Waters recently, it may be best to stay away from U.S.-listed China stocks altogether. In the end, regardless of the methods, it and other shorts were correct about the space. One thing specifically about ONP that I did not like after the thrashing of the price was that no insiders were buying the stock.
Surprisingly, I did well overall on my Orient Paper article recommendations as there were several opportunities to get out with excellent gains.
Considering I wrote two articles, the prices in between will not be used as it signifies the play at least up to that point.
Average Price Per share (publication dates): $4.90
Low since: $2.69 % decline: 45%
High since: $7.25 % increase: 48%
For 2 months it traded above $6
Current PPS: $3.55 % decrease: 28%
As I have stated in many articles, this is my favorite long-term large-cap stock. It provides value, growth, innovative products, demand and great expected future results. Overall, there is not much to not like. I still can feel very comfortable recommending this stock, especially when the forward P/E is near 10 and it is about to have its largest quarter ever and nothing looking ahead appears that it will slow down its success.
Since then, besides one big downturn, AAPL has performed very well and actually the downturn to $310 presented another excellent buying opportunity.
Average Price Per Share: $332.70
Low Since: $310.50 % decrease: 7%
High Since: $426.70 % increase: 28%
Current PPS: $389.70 % increase: 17%
Visa is an excellent company and even great to add on dips for long-term investors. For over a year it followed a nice pattern while it was trading in the $75 range and it had continual ups and downs of 5% to 10%. While many large caps are undervalued, Visa appears to be trading at a higher valuation than many, with a current PE above 20. It is still not expensive, but there are many others I would much rather buy at this point. Long-term, Visa should do well, but it has had an excellent run over the last 12 months. It would usually trade in the $70 to $80 range for a while, but in late January, there was an over-reaction in the stock when there was an announcement on fees to Visa being reduced for banks and that presents an even better opportunity for traders and long-term holders.
I sold long before it got to where it is now, and I was able to play the small ups and downs several times, but all those invested long, won in the end as well. It actually may even be a decent short here, but for now, it is probably just worth staying away at these prices.
In each, I stated a specific buy point and sell point in the articles
The time to start buying Visa is when it hits $72 and then continue with the other increments as it falls $0.50 - $1.00 (recommended). If it falls below $71, it can also be bought up to $72 as well. The time to begin selling is when it gets above $75 and sell every $2.00
I will buy if it gets below $70 and continue to buy as it goes lower. If it drops to $65, I will sell at $70. If it stays above $69, I will sell above $73. With Visa, it is easy to take 4%-7% profits on the way up and just buy as it goes lower. It is a quality company and is just stuck in a trading pattern over the last 9 months or so.
Based on each strategy, I was able to utilize each.
The first time an investor would have had an average buy of about $68 with an average sell of about $77.
% gain: 13%
Second recommendation: 7% gain
Average % gain: 10% based off of recommendation
Average PPS of each publication: $72.50
Low: $67 % decrease: 7.5%
High: $98.50 % increase: 36%
Current: $97.20 % increase: 34%
Options Express (OXPS)
This is one I wish I would have found just a little earlier as I discovered it a good time after the large, one-time dividend was announced, which equated to an all at once yield of over 20% (dependent on entry). Prior to running in to it while doing other research, I never encountered a situation like this and became intrigued right away. How couldn't you be? The more I found out, the more I realized that the long-term benefit was not there and would hurt the stock overall. Investors bought in for that dividend, but on the date of the dividend, the price drops by that amount and then trading starts at that price. Since so many got in for that dividend, as selling was happening, the price per share dropped much below the benefit the one-time dividend gave. Going in, even though a little late, I was going to sell before that date, as stated in my article, and not worry about the dividend as I thought the run would be better than it was. Personally, I gained about 4.5% in about a week. Others that got in earlier, made gains of up to about 35%. Not bad for me, but I was hoping for more. Recently, Charles Shwab (SCHW) bought the company.
Overall gain - about 5%
Chipotle Mexican Grill (CMG):
Minus the financials and growth, this is just a greatly run business and a restaurant that people want to eat at. Now, the company is definitely not undervalued and it was not undervalued when I recommended it either, as it is currently trading at a P/E of about 50 and then, was trading at P/E of about 40.
As I have come to realize more and more, it is much more than just a valuation of a company that matters. It is the psychology of what investors think of the company. Otherwise, every company with the same earnings growth would trade in the same P/E range and investing would be much more simplified. The positivity of the company and business model cannot be questioned and it is received in a very positive light by investors and part of the reason it gets the valuation that it does compared with other companies. Investors also see the future success and growth as the company is far from over saturated with less than, I think, 1200 restaurants, are set up worldwide, and worldwide expansion is just in the beginning phases. This has had a very good run, continually. While I do not think it is a good short, without a pullback, it would be difficult for me to pull the trigger here, but I wouldn't blame someone for getting a position at this point. I think a split would serve the company well in the near future while the positivity is, as it is.
Low since: $212 % loss: 5%
High Since: $348 % gain: 55%
Current Price: $330.49 % gain: 48%
This is a stock that I just should not have touched and I did not look ahead enough while doing my analysis and deciding to invest. I based the success too much on the very recent past, especially when, at that point, it was just off of picking themselves up quite a bit. The company beat estimates for a few quarters in a row, then the quarterly was due just after I put out the report and it was terrible and it has been down since. The momentum was already there and I should have known to stay away and at least watch it for a little while. I got out the day of the report. It is important to be able to change a viewpoint with negative or positive news that was not known prior. For the long term, this seems like a decent dip to buy, but the market and economy are unpredictable at the moment, although I am overall positive.
It has not gotten this high since, but there it stayed near the $14.50 range for about 5 months from that point.
at $14.50 % loss: 11%
Low since: $9 % loss: 45%
Current: 10.90 % loss: 33%
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.