I’ve made 20 stock purchase recommendations since April 27, 2005. Here’s how they have each performed from their selection through the third quarter of 2007, listed in the order of being recommended.
NOTE: Results include dividends and returns of capital to shareholders when applicable.
- General Motors (NYSE:GM) was mentioned on 4/29/05 at $26.75. It closed 9/28/07 at $36.70. This position is +49.3%.
- Fairfax Financial (FFH) was mentioned on 5/3/05 at $132.50. More shares were later purchased for an average cost of $123.16. It closed 9/28/07 at $244.00. This position is +82.3%.
- 3i Group was mentioned on 5/17/05 at $17.74 (adjusted for three subsequent reverse stock splits). It closed 6/29/07 at $20.25. This position is +66.8%.
- Nikko Cordial ADR (OTC:NIKOY) was mentioned on 5/26/05 at $8.64 (adjusted for a 5-for-1 ADR split). It closed 9/28/07 at $12.55. This position is +66.4%.
- Imagistics International was mentioned on 6/30/05 at $26.60. It was bought by Oce, N.V. later in 2005 for $43.00 cash. This position closed out +58%.
- Molson Coors (NYSE:TAP) Class B (TAP.B) was mentioned on 6/13/05 at $60.35. The entire stake was sold on 2/13.07 at $82.35. This position closed out +39.6%.
- DirecTV Group (NYSE:DTV) was mentioned on 7/21/05 at $15.50. It closed on 9/28/07 at $24.28. This position is +56.7%.
- Liberty Media Series A (LCAPA) was mentioned on 8/4/05 at $8.52. The company then distributed to shareholders two tracking stocks, Liberty Capital and Liberty Interactive, this year. I view those two as a single position in the portfolio. Capital closed 9/28/07 at $124.83 and Interactive closed at $19.21. This position is +29.6%.
- USA Mobility (USMO) was mentioned on 8/24/05 at $26.34. It closed on 9/28/07 at $16.87. This is a prime example of why including payouts is important. Still, this position is -5.2%.
- Comcast Class A Special (NASDAQ:CMCSA) was mentioned on 11/28/05 at the split-adjusted price of $17.82. One-quarter of the position was later sold at the split-adjusted price of $24.28. It closed on 9/28/07 at $23.96. This position is +34.9%.
- Deckers Outdoor (NASDAQ:DECK) was mentioned on 10/18/05 at $20.92. I later sold one-third of the stake for $30.08, then later sold more shares for $46.80. The remaining shares were sold on 2/15/07 at $63.58. This position closed out +131.
- CBS (NYSE:CBS) Class B was mentioned on 2/16/06 at $25.61. It closed on 9/28/07 at $31.50. This position is +27.6%.
- Media General Class A (NYSE:MEG) was mentioned on 3/21/06 at $47.05. More shares were purchased for an average cost of $44.76. It closed on 9/28/07 at $27.51. This position is -35.7%.
- Takefuji Corp. (OTC:TAKAF) was mentioned on 4/20/06 at $62.50. More shares were purchased on two separate occasions for an average cost of $49.18. It closed on 9/28/07 at $19.83. This position is -57.4%.
- Mueller Water Products Series A (NYSE:MWA) was mentioned on 7/19/06 at $15.88. I nibbled on a few more shares for an average cost of $15.64. It closed 9/28/07 at $12.39. This position is -20.3%.
- BCE Inc. (NYSE:BCE) was mentioned on 8/6/06 at $23.01. I later sold one-quarter of the stake for $36.31. It closed 9/28/07 at $40.05. This position is +75.0%.
- ArmorGroup International (OTC:AMGPF) was mentioned on 9/7/06 at $1.03. It closed on 9/28/07 at $1.30. This position is +31.4%.
- Walter Industries (NYSE:WLT) was mentioned on 9/27/06 at $43.21. Mueller Water Products Series B was later spun off from Walter. On 5/18/07 Walter Industries was sold at $29.49 and Mueller Water Series B was sold at $15.78. Taken as a single position, these two combine for +28.9%.
- Aiful Corp. ADR (OTCPK:AIFLY) was mentioned on 7/10/07 at $6.60. It closed on 9/28/07 at $4.00. This position is -39.4%.
- Foot Locker (NYSE:FL) was mentioned on 7/25/07 at $20.87. It closed on 9/28/07 at $15.33. This position is -26.6%.
In all, the stock picks made on this blog have averaged a gain of 29.7% during the life of this blog. This has been a painful quarter, which will be even more evident when posting YTD results for the stock picks.
Five points need to be made:
First, these are not “annualized” results or year-to-date results. These are simply how the stock picks have performed since being recommended. I will post YTD results next.
Second, as stated, these results include dividends and returns of capital to shareholders. I did this because not doing so distorted the performance of my stock picks -- especially in cases like 3i Group and USA Mobility.
Third, I factor in partial sales. Regular readers know I’ve taken partial profits in stocks such as BCE, Comcast, Fairfax Financial and Nikko Cordial over time. Factoring in these sales (and purchases when averaging down) gives readers a more accurate view of this blog’s stock picking performance.
Fourth, these are not “audited” results. They’re just my calculator and me and I’m subject to correction.
Fifth, I live in the US so I track my portfolio in US Dollars. Someone following my picks and residing in Canada, the UK or another country may see results better or worse than mine.
As a group, the stocks held this year have an average loss of 3.1% through the first three quarters of 2007. That compares to the S&P 500 being up 7.6% for the same time period, according to WSJ.com. For reasons stated previously, I am now factoring in dividends and returns of capital to shareholders in my results. I don’t believe the S&P 500 result reported on WSJ.com includes dividends.
Here’s how each of the holdings have performed so far this year.
BCE Inc. +48.1%
Fairfax Financial +23.6%
General Motors +21.9%
Nikko Cordial ADR +10.6%
Walter Industries/Mueller Water Products Class B +7.8%
Molson Coors Class B +7.7%
Liberty Media (Liberty Capital/Liberty Interactive) +7.3%
Deckers Outdoor +6.1%
3i Group +5.9%
CBS Class B +3.1%
DirecTV Group -2.6%
ArmorGroup International -11.3%
Comcast Class A Special -14.2%
Mueller Water Products Series A -16.4%
USA Mobility -18.8%
Media General Class A -24.1%
Foot Locker Inc. -26.6%
Aiful Corp. ADR -39.4%
Takefuji Corp. -47.1%
The stock picks averaged +9.95% at the end of the second quarter. To go from that to -3.1% means the last quarter was brutal. My last two stock picks -- Aiful and Foot Locker -- took no time at all to achieve double-digit declines after being purchased. Takefuji has seen the bottom fall out this year. And with Media General, USA Mobility and Mueller Water the hits just kept on coming.
Battered and bruised, I remain cautiously optimistic (taking the long-term view) and wait to see what the rest of the year has in store.