Progressive Jumps - The Downside To Slower Decision-Making

In an earlier post, I described how I generally prefer to make investment decisions slowly. There is a downside to doing that, as exemplified by me missing Progressive's (PGR) 6.2% jump Thursday.

Progressive is a stock that has been on my watchlist for a few weeks. It looked like the type of story I like to buy: a superior business temporarily out of favor. The stock has traded down to a low near $21 from a high around $31 at year end 2005. I noted a low P/E, high returns on equity, and the fortune Buffett made buying Geico. I looked forward to getting to know Progressive better.

PGR jumped on the announcement of a recapitalization plan which includes a special dividend, share buybacks, and a hybrid debt offering. At $24.70 Progressive may still be a buy, but I sure wish I studied it before today's events.

That said, I still stand by my investment approach. Hasty decisions might make me money sometimes, but they would lose me plenty of money as well. I like to know what I own and see value in doing my homework before I buy, even if it will at times cost me a higher price or missed opportunities.

One more thought: for stocks that I'm already familiar with, I am willing to make investment decisions at the drop of a hat. There's a time to deliberate and a time to act. A generally slow approach should not preclude bold moves if you have the work and conviction to back it up.