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What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:25 AM   #1
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What do you think of RUTH (Ruth's Chris)?

I'm a complete fundaholic and have never owned anything in my portfolio besides, index/ actively managed funds. This has served me very well for the past 7 months, gaining 20%. However, I've come into a little inheritance money and want to gambooool a bit. What's the outlook on Ruth's Chris, besides having excellent steaks? P/E is a bit below the SPX, and the cat might already be out of the bag on this company, but again this is not my expertise area at all. Any equity picker help me here?
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:31 AM   #2
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Re: What do you think of RUTH (Ruth's Chris)?

I like the creamed spinach but I'm not a huge fan of their bread pudding.

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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:31 AM   #3
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Re: What do you think of RUTH (Ruth's Chris)?

There are a LOT of steakhouses popping up around the country.

I think the ethanol subsidies are going to make the price of beef soar, as beef cattle eat a lot of corn, and the price of corn is moving up faster than the price of gas.

I did pretty well in Applebees a few years ago, but the only stock I own in portfolios for clients that could be considered hospitality is SBUX.

Proceed with caution.............
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:38 AM   #4
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Re: What do you think of RUTH (Ruth's Chris)?

AJ, if you are serious about picking stocks, I would park the inheritance money in a MM and go start reading finance and valuation textbooks. Then start following a few companies. Try to model a few and maybe even do a paper/fantasy portfolio first. After you have some confidence, then you can start actually buying individual picks.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:38 AM   #5
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Re: What do you think of RUTH (Ruth's Chris)?

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Originally Posted by brewer12345
AJ, if you are serious about picking stocks, I would park the inheritance money in a MM and go start reading finance and valuation textbooks. Then start following a few companies. Try to model a few and maybe even do a paper/fantasy portfolio first. After you have some confidence, then you can start actually buying individual picks.
Sound advice, WHERE'S the GAMBLE in that
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:44 AM   #6
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Re: What do you think of RUTH (Ruth's Chris)?

Brewer's advice sounds good....but I would be tempted to just bet it all on red
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:45 AM   #7
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Re: What do you think of RUTH (Ruth's Chris)?

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Sound advice, WHERE'S the GAMBLE in that
Believe me, there is still plenty of gamble left even after you do all that work. I do this for a living and there are still plenty of "spectacles, testicles, wallet and watch" moments.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:46 AM   #8
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Re: What do you think of RUTH (Ruth's Chris)?

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Originally Posted by brewer12345
Believe me, there is still plenty of gamble left even after you do all that work. I do this for a living and there are still plenty of "spectacles, testicles, wallet and watch" moments.
How about Baron Rothschild's comment" fortunes have been made by selling too soon"................still one of my favorites..............
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:49 AM   #9
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Re: What do you think of RUTH (Ruth's Chris)?

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Originally Posted by brewer12345
AJ, if you are serious about picking stocks, I would park the inheritance money in a MM and go start reading finance and valuation textbooks. Then start following a few companies. Try to model a few and maybe even do a paper/fantasy portfolio first. After you have some confidence, then you can start actually buying individual picks.
Sounds like fair advice, even though I'll skip the MM, since I mean it doesn't take a rocket scientist to put money in Merriman's portfolio, to secure 10% returns a year over the long haul. I was just curious what everyone thought about this particular company, and its prospects. Whenever I go into one business is booming, and they are looking to open up new stores every month. I guess nobody has any thoughts either way.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:51 AM   #10
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Re: What do you think of RUTH (Ruth's Chris)?

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Originally Posted by AirJordan
Sounds like fair advice, even though I'll skip the MM, since I mean it doesn't take a rocket scientist to put money in Merriman's portfolio, to secure 10% returns a year over the long haul.
Secured 10% returns? Wow! sign me up!
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 09:51 AM   #11
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Re: What do you think of RUTH (Ruth's Chris)?

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How about Baron Rothschild's comment" fortunes have been made by selling too soon"................still one of my favorites..............
The selling part is easy (relatively). The decision to commit capital to a new position requires the most work, and the decision to keep buying into a slump because (you think/hope/pray) thevalue is there requires the most testicular fortitude.

If you REALLY want to play catch with dynamite, you can trade options.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 10:01 AM   #12
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Re: What do you think of RUTH (Ruth's Chris)?

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The selling part is easy (relatively). The decision to commit capital to a new position requires the most work, and the decision to keep buying into a slump because (you think/hope/pray) thevalue is there requires the most testicular fortitude.

If you REALLY want to play catch with dynamite, you can trade options.
1)Isn't "averaging down" like trying to catch a very sharp falling knife most of the time?

2)I'd rather sell options than trade them...........
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 10:26 AM   #13
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Re: What do you think of RUTH (Ruth's Chris)?

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1)Isn't "averaging down" like trying to catch a very sharp falling knife most of the time?

2)I'd rather sell options than trade them...........
1) Depends. By the time I start buying, the asset of interest has generally already taken a walloping, since I am a value oriented bottom fisher. It is tough to buy at the bottom, since nobody knows exactly when that will be. So when I have done analytical work that tells me that current prices offer very strong value and potential returns, I will start buying, but I rarely ever buy what I regard as a "full" position in the first go. If it keeps dropping, I keep buying. If I get full up on a position and it drops more, I will usually just wait it out. However, sometimes when I am sufficiently convinced that there is real strong value and something has fallen really far and I am "full up", I will buy a wad of longer-dated somewhat out of the money call options. That way I can magnify my exposure if things work out, but limit my losses if they don't.

Example, I started buying WHI around $5.25. I think it is easily worth $10 when they work through their credit issues and I have little fear of them completely imploding. I kept buying down to a bit under $5. When teh stock slumped down to $4.65 or so, I was full up, so I bought the longest dated $5 strike call options I could get. We will see how this works out over time, but the Q1 results they put out suggest that they are already working through their credit issues and the PR bank scene is just waiting for a wave of consolidation.

2) Sometimes good to sell, sometimes good to buy. Anything at a price, right? I have made an awful lot of money in the past year by trading options around core positions in the stocks I already own.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 10:40 AM   #14
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Re: What do you think of RUTH (Ruth's Chris)?

OK, I know this thread isn't about food, but as an aside I am astounded that nobody has mentioned their Porterhouse for Two. We love it on a special occasion.

As for the organization, a lot of people are saying that some very poor decisions have been made since Ruth Fertl passed away. I don't know much about it myself. Of course, the decision to move their HQ (to Florida, was it?) wasn't very popular here.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 10:49 AM   #15
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Re: What do you think of RUTH (Ruth's Chris)?

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OK, I know this thread isn't about food, but as an aside I am astounded that nobody has mentioned their Porterhouse for Two. We love it on a special occasion.

As for the organization, a lot of people are saying that some very poor decisions have been made since Ruth Fertl passed away. I don't know much about it myself. Of course, the decision to move their HQ (to Florida, was it?) wasn't very popular here.
It may not be about food, but it should be!

I'm not too happy with what they have done to the chain. It's just the nature of my business that I eat at a a lot of steakhouses. I'm not thrilled with what they did to the prices at RC. The salads have gotten smaller too.

I'm a huge fan of the porterhouse and the NY strip, but if I had my choice I would rather hit Morton's

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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 11:10 AM   #16
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Re: What do you think of RUTH (Ruth's Chris)?

I don't eat beef, so steakhouses have little appeal. When I used to have togo to a lot of business meals, steakhouses were a common choice. I was always happy if the choice was a Ruth's Chris because they usually have better and more seafood than most steakhouses. But I haven't been there in a couple years, so I don't know what has happened recently.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 11:22 AM   #17
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Re: What do you think of RUTH (Ruth's Chris)?

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Originally Posted by AirJordan
However, I've come into a little inheritance money and want to gambooool a bit. What's the outlook on Ruth's Chris, besides having excellent steaks?
You post at FundAlarm, too, right? So you know David Snowball.

I was in your position five years ago with the same brilliant idea, which I posted to FundAlarm. David said "This is a really bad idea. If you want to gamble, go to Vegas and have fun with your money. If you want to do something useful with that money, donate it to charity." Of course I'm smarter than David so I ignored his advice in favor of my personal tailored experiential approach. Yup.

I've been through the full circle... brokerage advisors, newsletters, Hulbert, CANSLIM, Zurich Axioms, Elliott Wave, chaos/fractals, "Think and Grow Rich", Jesse Livermore, Nicholas Darvas, Sam Weinstein, TA, momentum, "quality management", IPOs, Dogs of the Dow, Unemotional Value, dividends, options, shorting, high-probability trading, and (my personal favorite) deep value. Over the first four years I was slightly lagging money-market returns, although with record-breaking volatility. Over the last nine months I'm up 20%.

I'm too cynical to believe that the last nine months was all me, even boosted by Brewer's patient tutoring, but a lot of it is due to... hard work. The path to success lies in reading the SEC filings, picking apart the financials, building a model of the company's cashflow, and patiently awaiting a buying point. Sometimes the wait is months to years and the analysis file grows an inch thick without even buying a single share. Little of that info is obtained by posting to discussion boards-- unless you count talking to insiders about their companies or starting conversations with guys like Brewer, FD, & Saluki. One of the acknowledged investment strategies is joining a club and having to defend your picks to the derision thoughtful analysis of the rest of the group, which you can do here for free. However you're not pooling money with those people so your analysis (and theirs) is worth what you're paying for it.

Your results will directly correlate to the quantity & quality of your efforts, which should largely be devoted to analysis. You'll lose money at first but you'll get better after a few years.

I've settled on value from cash flow, which also includes shorting an occasional high-flying stock. Everything else seems to be excessive labor/risk for less return or just a bunch of crap. Even Gary Smith's ER from "How I Trade for a Living" has come at a very high personal price.

Swedroe & Bernstein had some poignant comments on M* a couple years ago about investors being inadequately compensated for single-stock risk, especially when it interferes with getting a life. Those critiques hit home, and today our ER portfolio is still with Buffett and ETFs... only 10% individual stocks, and I'm done buying. I may have to contemplate a 12-step program to close out my shorts.

But you don't have to believe me. Go ahead-- take a deep swig of testosterone and pay your own tuition at the school of experience.

As for me, I'm going to eventually close out my positions. I've been to Vegas, so the money will probably go to charity to offset our taxable gains.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 11:33 AM   #18
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Re: What do you think of RUTH (Ruth's Chris)?

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I've been through the full circle... brokerage advisors, newsletters, Hulbert, CANSLIM, Zurich Axioms, Elliott Wave, chaos/fractals, "Think and Grow Rich", Jesse Livermore, Nicholas Darvas, Sam Weinstein, TA, momentum, "quality management", IPOs, Dogs of the Dow, Unemotional Value, dividends, options, shorting, high-probability trading, and (my personal favorite) deep value. Over the first four years I was slightly lagging money-market returns, although with record-breaking volatility. Over the last nine months I'm up 20%.
Wow, after all that it's amazing you aren't a 50/50 mix of short-term Treasuries and CD's.................
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 11:42 AM   #19
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Re: What do you think of RUTH (Ruth's Chris)?

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Wow, after all that it's amazing you aren't a 50/50 mix of short-term Treasuries and CD's.................
You mean like my parents in law? I'm capable of learning from the examples set by others...

I should point out that none of this experimentation occurred with the ER portfolio. It was only done with the separate inheritance account, and I'd never activate shorting & options with the account holding our ER portfolio.
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Re: What do you think of RUTH (Ruth's Chris)?
Old 05-11-2007, 11:44 AM   #20
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Re: What do you think of RUTH (Ruth's Chris)?

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I should point out that none of this experimentation occurred with the ER portfolio. It was only done with the separate inheritance account, and I'd never activate shorting & options with the account holding our ER portfolio.
Of course, students of behavioral accounting would point out that all of that separation-type mental accounting is so much marsh gas...
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