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Re: Forum Picks
Old 05-18-2007, 02:45 PM   #21
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Re: Forum Picks

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Originally Posted by brewer12345
A suggestion: If this is going to be an analysis thread, let's try to be a bit more robust.
In addition to new holdings, it's also worth analyzing when to sell current holdings like Stonemor, Eagle, Diana, Intel... compared to the sell decision, buying is easy.

FD, I've been biting my tongue about the rationale behind your latest recommendations-- that's not the kind of analysis your clients want, is it?!?
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Re: Forum Picks
Old 05-18-2007, 02:51 PM   #22
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Re: Forum Picks

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Originally Posted by DOG52
Wow, that is almost a 10% dividend based on CSE current price. Thanks for the tip on TONE and keep us up to date.
I had a chance to comb through CSE's financials. Based on what I saw, I am content to hang onto TONE at least through the 1 year window for cap gains, and quite possibly longer if they do a good job of integrating the bank and capitalizing on growing deposits as a funding base.

However, there are significant risks. By far, the biggest risk with CSE is that they are a credit shop. They do a wide variety of loans aimed at middle-market businesses. Average loan is under $20MM, and they specialize in real estate, healthcare, and asset-based loans. Generally, they seem to do a good job of underwriting the loans, but if we go into a recession CSE will start seeing loan losses pick up (as you would expect). I don't know what kind of pain a 2002-2003 experience would put them in, since the company was started in 2000 and was pretty small by the time they IPO'd in 2003, but it would probably be substantial. Having said that, they appear to have a nicely dversified, well underwritten book of loans and the addition og TONE should spread them even more widely.

Given the attractive dividend yield and CSE's performance to date, I think it is worth the risk for a modest position.
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Re: Forum Picks
Old 05-18-2007, 02:54 PM   #23
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Re: Forum Picks

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Originally Posted by Nords
In addition to new holdings, it's also worth analyzing when to sell current holdings like Stonemor, Eagle, Diana, Intel... compared to the sell decision, buying is easy.
Funny you should mention that. I have been gradually selling my STON position as it got over 25. I just let some more go at 27, and I still have half my original position. STON is a nice company, but the yield is down to 7% and change. I will let te rest go if it gets to 30, since I think the yield would be too thin at that price. I;ve little doubt that the company will see increased cash flow from teh acquisitions they did last year, but given the small size and increasingly small yield I believe there are an increasing number of more attractive opportunities as the price goes up.
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Old 05-18-2007, 03:26 PM   #24
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Re: Forum Picks

I am bowing out. I'll leave it up to brewer. It appears the bias on this thread is toward large dividend with moderate upward price appreciation potential.

And Nords was right, unless I'm willing to put ALL my portfolios on here, with a large amount of in-depth discussion about them, I probably shouldn't................

FWIW, I have been buying and selling MGEE for many years............
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Old 05-18-2007, 03:44 PM   #25
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Hey, FD, don't go off in a huff. I for ne am genuinely interested in any ideas. But I really value careful analysis and tangible cash flows from anything I buy.
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Re: Forum Picks
Old 05-18-2007, 03:52 PM   #26
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Re: Forum Picks

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FWIW, I have been buying and selling MGEE for many years............
I know a bit about them being in WI, but never invested....somebody on drip investing boards from madison invests in them...nice dividend...

Anybody have anything in the mid to large cap dividend payers that are down and out? looks like 3m has bounced back...jnj still looks to lag a bit...also been taking some shots of Brown Forman....
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Old 05-18-2007, 04:00 PM   #27
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FORG
Entry point: 1.16
Time: one week ago
My thesis:
1. Net cash 14M
2. Settlement 20M with 9 corps, after lawyer fee, 12M
3. Remaining 6 corps (assuming 8M net).
4. It has cash flow positive software business with 4M revenue/year.

So cash (14+12+8)/25=1.36/share

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Old 05-18-2007, 04:01 PM   #28
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Re: Forum Picks

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Originally Posted by brewer12345
Hey, FD, don't go off in a huff. I for ne am genuinely interested in any ideas. But I really value careful analysis and tangible cash flows from anything I buy.
MGEE is Madison Gas and Electric, the primary utility in Madison, Wisconsin. They are a small cap utility I use as a core holding. While their yield is moderate (about 4%), they have been using a lot of their free cash to update their current infrastructure, buy out some small town utilities around the state, and improve their efficiencies.

I always increase my holdings when the stock pulls back under $32. In my neck of the woods, people like it a lot better than Wisconsin Electric, and I can'tblame them. Certainly anything under $32 would be a bonus. I imagine they will raise the dividend in a year or two after all their expenditures on various improvement projects are completes. Just a steady broing stock............ Dividends are $1.39 a share..............
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Re: Forum Picks
Old 05-18-2007, 04:03 PM   #29
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Re: Forum Picks

Forg will up big on Monday. It just settled with DirectTV at 8M. Target 1.7, maybe 2.
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Old 05-18-2007, 04:09 PM   #30
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Re: Forum Picks

Duh - why sell? I want the 'never sell stock' that allows the butler to steam press my best Jimmy Buffett shirt while the maid brings the latest tropical punch out on the veranda of my villa next to Sir John.

Remember Hamlet and fastenal(FAST) back a ways?

Aetna is hardly a screamer - but they cut their dividend, dumped their boss, and have been trying to get back to basics the last few years. Unlike me some of those other baby boomers may need medical insurance.

I'm not a trader - looking for that wish upon a star stock!

heh heh eh - BTW - my steady boring stock (Hydraulic) morphed into Aqua America (WTR) still a water ute.

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Old 05-18-2007, 04:09 PM   #31
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Re: Forum Picks

Quote:
Originally Posted by FinanceDude
MGEE is Madison Gas and Electric, the primary utility in Madison, Wisconsin. They are a small cap utility I use as a core holding. While their yield is moderate (about 4%), they have been using a lot of their free cash to update their current infrastructure, buy out some small town utilities around the state, and improve their efficiencies.

I always increase my holdings when the stock pulls back under $32.
Any reason why $32 is the magic number? I haven't looked into the stock, but when you say you always increase your withholdings when the stock goes below $32 makes it sound like it happens frequently.
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Old 05-18-2007, 04:38 PM   #32
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Duh - why sell? I want the 'never sell stock' that allows the butler to steam press my best Jimmy Buffett shirt while the maid brings the latest tropical punch out on the veranda of my villa next to Sir John.
I am with you UM....
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Old 05-18-2007, 06:52 PM   #33
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FORG up 16% AH. My 1.7 target seems too convervative.
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Old 05-18-2007, 08:00 PM   #34
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Re: Forum Picks

Quote:
Originally Posted by FinanceDude
MGEE is Madison Gas and Electric, the primary utility in Madison, Wisconsin. They are a small cap utility I use as a core holding. While their yield is moderate (about 4%), they have been using a lot of their free cash to update their current infrastructure, buy out some small town utilities around the state, and improve their efficiencies.
One of the things that makes me a bit queasy about electric utilities these days is that coal prices have moved way up compared to 5 years ago. As old coal supply contracts roll off, many utilities are exposed to much higher fuel prices and have to go begging to the PUCs to recoup the cost of fuel. Any clue what the deal is with MGEE on this front? I also occasionally think about NJR and Green Mountain Power, but the huge run they have had over the past several years makes me wary.
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Old 05-18-2007, 08:22 PM   #35
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Splits/Spin-offs (a lot are upcoming):

A) Temple Inland - Will divide into 3 companies 1) real estate w/timber assets 2) manufacturing 3) financial services
B) EMC - Fast growing tech unit VMware
C) Marshall Isley - Fast growing financial processing unit Metavante
D) Tyco - Will split into 3 companies, Tyco healthcare division does $8-9 bil in revenue and only contributes apprx 1% of it into R&D vs. comps of 8-9% (appears to be way underfunded)
E) Morgan Stanley - Will dispose of Discover
F) American Standard - Will split into 3 companies
G) Amerisource/Kindred - combined to form an institutional pharmacy; direct (and only real) competitor OCR
H) NCR - Will spin off Teradata
I) BR - Broadridge Financial Solutions; spun off of ADP; do back office brokerage/financial processing; basically do the crappy grunt work brokerage firms don't wanna do.

Of the ones above, Metavante is my fav business but I am not sure what the valuation will be. I am not sure how these will play out as they haven't happened yet but worth watching for the stock junkie crowd.
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Old 05-18-2007, 08:27 PM   #36
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I still like fertilizer stocks. POT, AGU, MOS, SQM, ICL and Yara. My favourite is POT and it's 30% of my net worth so take as many grains of salt as you feel appropraite.

My take on POT
Upsides: lots of FCF to fund (low cost) expansion; high barriers to entry (at least for potash and phosphate); rising demand (at least for now).

Downsides: sky high P/E; politics of biofuels, I don't think they are economic but governments are pushing them big time; drop in Asian economies could kill food demand; up bigtime over the last 3 years so maybe little room left; miniscule dividend; Cramer likes it

It may not not be a big winner short term but I think it's a buy and hold over the next 5 years.

DYODD, Just my pick and I've been wrong many times
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Old 05-18-2007, 09:42 PM   #37
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Kumquat:

Could you give some light why you like Yara? I watch it closely.
Thanks,
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Old 05-18-2007, 09:47 PM   #38
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Hey don't tell HFWR you can invest in POT. I imagine he will liquidate everything.
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Old 05-18-2007, 10:19 PM   #39
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Re: Forum Picks

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Kumquat:

Could you give some light why you like Yara? I watch it closely.
Thanks,
Yara is a fertilizer stock. I like them all. Last time I looked (a while ago), Yara's P/E was lower than the others.

My favourite is POT, but the others exist and may be better if you can find a reason why. The only one I own (or would buy) is POT.
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Old 05-18-2007, 10:38 PM   #40
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Re: Forum Picks

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Yara is a fertilizer stock.
Yep, I know the feeling. Way too many of my stock picks turned out the same way.

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