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Scott Wachsler
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I manage Wax, a baseline equity research company comprised of individual investors not licensed or registered with any government agency. I have been all cap value investor and independent equity researcher for the past 30 years, and believe that patience is the key to successful... More
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Wax Ink
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Wax Ink
  • Performance - 09/06/2013 0 comments
    Sep 7, 2013 10:33 AM | about stocks: BWLD, CHRW, BCR, CBI, CGI, CENX, SWM, TLAB, CLF, LDOS, HFC, AGUNF

    Almost every business day there is some sort of scheduled economics announcement. Before these actually occur, analysts from all of the major Wall Street firms, as well as from all of the major banks, come out with their various predictions. None of these predictions is ever correct, yet investors seem to hang on every utterance.

    The reason none of these predictions will ever be correct is because the game is rigged. The numbers given out for this month, are always revised when the numbers for the next month are announced. It is like playing tic-tac-toe. The best the markets can ever hope for is a draw. Yet the investment community hangs on every word.

    Case in point. Yesterday August non-farm and private payroll numbers were announced. The economic gurus had collectively predicted an increase to 177,000 for non-farm payrolls and an increase to 180,000 for private payrolls.

    But the numbers came in at 169,000 for non-farm payrolls and 152,000 for private payrolls. To my mind I am happy to see an increase, any increase, because at least I know a few more people returned to the work force. Of course the markets response was that the announcement indicated a lackluster economy.

    Having heard the less than stellar economic news, traders began dancing around as if needing to pee and then went on with their day, while the news outlets simply reported the numbers. And that…was that.

    What nobody seemed to focus on were the revised July numbers, where non-farm payrolls were reduced to 104,000 from the previously announced 162,000, and private payrolls were reduced to 127,000 from the announced 161,000. That is a pretty big swing in "previously" announced numbers, numbers many investors are taking to the bank.

    The announcement also contained the unemployment rate, which fell to 7.3% from 7.4%. But it was the reason for the lowered unemployment rate that caught my eye, and that was the decline in the labor force participation rate to roughly 63%, its lowest rate in 33 years.

    What that tells me is that 37 out of every 100 Americans that make-up the work are not working, have given up, or are working off of the grid. If that doesn't give investors something to consider, I have no idea what will.

    Hi. My name is Wax, and I am an individual investor, a working class investor, just trying to do the best I can in a world that was never intended for investors like me.

    Throughout the course of the week, I post a Daily Alert, which is my review of an individual equity. It is intended to help the reader decide if that particular equity is worth their time to research.

    The other thing I do, is let the world watch as I manage the The Wax Ink Portfolio.

    Perhaps watching me make the mistakes I make will help other working class investors avoid the investing pitfalls that seem to find me.

    Enjoy your weekend


    The Wax Ink Portfolio was up 2.0% for the week. By comparison, the Dow was up 0.8%, the Nasdaq was up 2.0%, the S&P 500 was up 1.4%, the Russell 2000 was up 1.8%, and the Volatility Index, commonly known as the VIX, was down 6.8%.

    Year to date, the Wax Ink portfolio is up 19.4%, the Dow is up 13.9%, the Nasdaq is up 21.2%, the S&P 500 is up 16.1%, the Russell 2000 is up 21.2%, and the VIX is up 4.0%.

    The Wax Ink Portfolio currently holds 61,072 shares of stock spread among 24 companies. The breakdown remains unchanged with roughly 70% of the portfolio in equities, 30% of the portfolio in cash, and 0% of the portfolio in bonds.

    I finished baseline equity reviews on the following companies during the course of the week. My rating follows the ticker symbol.

    Buffalo Wild Wings (Nasdaq: BWLD) - Negative Investment Interest

    C.H. Robinson Worldwide (Nasdaq: CHRW) - Negative Investment Interest

    C. R. Bard (NYSE: BCR) - Negative Investment Interest

    Chicago Bridge and Iron (NYSE: CBI) - Negative Investment Interest

    Celadon Group (NYSE: CGI) - Positive Investment Interest

    Century Aluminum (Nasdaq: CENX) - Positive Investment Interest

    This week's moving on up stocks were paper maker Schweitzer-Maudit International (NYSE: SWM), up 13%, communications equipment maker Tellabs (Nasdaq: TLAB), up 7%, and iron ore producer Clffs Natural Resources (NYSE: CLF) was up 5%.

    This week's floaters in the bunch bowl were technical services provider SAIC (NYSE: SAI), down 5%, oil refiner Holly Frontier Corporation (NYSE: HFC), down 2%, and agricultural chemicals company Agrium (NYSE: AGU), down 1%.

    Not Performing
    The top portfolio choke and puke stocks remain communications equipment company Tellabs, down 56% since being added to the portfolio, garage door and telephone headset maker Griffon Corporation, down 37% since being added to the portfolio, and iron ore company Cliffs Natural Resources, down 55% since being added to the portfolio.

    Copyright © 2013 Wax Ink

    Wax Ink is a baseline equity research company not licensed or registered with any government agency

    Disclosure: I am long SWM, TLAB, CLF, SAI, HFC, AGU.

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