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I consider myself a value investor, this investment philosophy boils down to investing undervalued, under-researched and unpopular companies; reasons for one of these three elements can be different: special situations (spin-off, turnarounds, arbitrage), analyst coverage (low or very negative... More
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  • Olympic Performance Of My Portfolio In 2012 0 comments
    Aug 10, 2012 4:05 PM | about stocks: AAPL, KO, PEP, DD, GMCR, SMP, PCAR, WAG, WFC, F, GM

    My Covestor portfolio was launched on January 19, 2012. Since then the portfolio is up 13.4%, while the S&P 500 is only up 7.2%. Thanks to this strong performance my portfolio is currently ranked #2 in the value category / performance vs. S&P 500. A few of of my recent acquisitions have performed exceptionally well:

     

    1. Green Mountain Coffee Roasters (GMCR) is up 14.16% since I bought it at $21.25 on July 17th
    2. Standard Motor Products (SMP) is up 25.6% since I bought it at $13.75 on July 17th
    3. PACCAR (PCAR) is up 8.03% since I bought it at $37.83 on July 2nd
    4. Walgreens (WAG) is up 22.71% since I bought it at $29.45 on July 2nd

    To date, my portfolio has outperformed the S&P 500 by 6.2%. An impressive performance considering that I currently have 33 positions open and not a single position comprises more than 20% of the total portfolio.

    My strategy for the third quarter of 2012 will be to focus on industries connected with the housing market. Although it is not clear to me whether the housing market has reached bottom yet, there are some encouraging signs that indicate that the industry will start to rebound slowly starting as early as the end of 2012. On July 12th, I began to accumulate shares related with this industry. The first position I purchased was DuPont (DD), a major producer of some of the most popular building and construction materials such as Tyvek®, SentryGlas®, Corian® solid surfaces, Zodiaq® quartz surfaces and KEVLAR®. DuPont is a worldwide industry that will immediately benefit from a rebound in the housing industry in United States. After my acquisition, DD is up 8.92%. This is a holding I plan to keep long-term and over time, I will increase my position. At 13.75 PE DD is attractive enough. It is also paying a dividend yielding at a 3.39%.

    My largest holding at the moment is APPL which continues to do well and will remain my largest holding in 2012. Their balance sheet looks strong, and the new products Apple has in the pipeline look very promising (e.g. Apple TV, iPad in new sizes, and the new iPhone). The company also recently announced that will begin to pay dividends and will repurchase some of its shares.

    My second largest position, Wells Fargo Company (WFC), continues to perform extremely well, at a 11.13 PE, I believe the shares still have a lot of upside potential. While most of banks in US are still down after the economic crisis, Wells Fargo continues to increase its market share and presence throughout the country.

    I believe the third quarter will be hard on investors, as long as the European crisis continues. For the remainder of 2012, I am planning on adding positions in some of the defensive stocks in my portfolio, which include Well Fargo (WFC), Pepsi (PEP) and Coca Cola (KO).

    Finally, I believe that the auto industry will improve substantially in 2013, shares of Ford (F) and General Motors (GM) have been going down since April due to poor performance of European sales, but domestically these companies are selling well. As long as the demand for automobiles in the U.S. continues to grow, I don't think these stocks will decrease any further. As a result, I recently opened two small positions in my portfolio for Ford and General Motors, both stocks are currently very cheap, at 2.11 PE (Ford) and 7.29 PE (General Motors).

    Disclosure: I am long AAPL, KO, PEP, DD, GMCR, SMP, PCAR, WAG, WFC, F, GM.

    Stocks: AAPL, KO, PEP, DD, GMCR, SMP, PCAR, WAG, WFC, F, GM
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