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Elias Tsepouridis'  Instablog

Elias Tsepouridis
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  • EZPW Price Target at $16.91 with some upside

    As I continue to hold EZPW in my portfolio with positive alpha, I want to set a price target for the stock to help me identify when the position should be closed.  Using the value scorecard as a start, I use a discounted cash flow (DCF) analysis with sensitivity charts to help set my price target.

    For EZPW, I have calculated a price target of $16.91 per share.  Some of the major assumption to get to this price per share are a 5% free cash flow growth rate over the next five years with a 0%  terminal value.  The cash flows are discounted with a WACC of 7.7%

    To see my full set of assumptions and resulting analysis, see the document below:

    DCF Summary

    Looking at the sensitivity chart, these shares can easily get into the $20 per share with some slight increases on both growth rates...

    As new financial results are provided, I will update my price target accordingly.

    Author Disclosure: I currently own shares of EZPW at the time of this posting.

    Nov 22 9:23 PM | Link | Comment!
  • Bare Escentuals, Inc Covered Call Results

    In bowling it is called a turkey, that is right I have beat the S&P 500 3 times in a row through my trades.  The most recent strike that I bowled was the Covered Call trade on Bare Escentuals, initiated back on Sept 23rd, 2009.

    The October 16th expiration date has come and passed on this strategy with BARE closing at $13.28, well above the $12.50 call option price that I sold.  So if you are not familiar with option trading, the underlying option that I sold was exercised and I sold my position at $12.50 less commissions.  I know it seems crazy that I sold for $12.50 when the stock closed over 0.75 higher but that is risk you take when you enter into a covered call (limits your upside for the premium)

    Trade Summary (includes commissions):

    Net Cash Investment: $1,162.70

    Net Cash Proceeds: $1,239.01

    Return of 6.56% over 23 days

    S&P 500 return for the same time period 2.53%

    Alpha Generated of 4.04%

    So I am on a search for my next investment to continue the streak. If you have any ideas, please feel free to leave me a comment with your trade recommendation for my portfolio. I will update my net worth accordingly.

    I also want to say congrats to PF Stock for capturing a gain on BARE during the same time period, although he didn't enter into a covered call he was still able to lock in some gains on the upward movement of the stock.

    Author Disclosure: I no longer have a position in BARE.

    Oct 17 9:46 PM | Link | Comment!
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