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Scott Adams offers stock picking advice--pick companies you hate.
Old 06-07-2010, 12:48 PM   #1
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Scott Adams offers stock picking advice--pick companies you hate.

Dilbert's creator offers his advice on how to pick stocks.

Betting on the Bad Guys

He provides his take on BP, Wells Fargo, Berkshire Hathaway, Apple, etc. Along the way he lampoons technical analysis and other stock-picking techniques. Excerpts:

Quote:
When I heard that BP was destroying a big portion of Earth, with no serious discussion of cutting their dividend, I had two thoughts: 1) I hate them, and 2) This would be an excellent time to buy their stock. And so I did. Although I should have waited a week.

People ask me how it feels to take the side of moral bankruptcy. Answer: Pretty good! Thanks for asking. How's it feel to be a disgruntled victim? I have a theory that you should invest in the companies that you hate the most. The usual reason for hating a company is that the company is so powerful it can make you balance your wallet on your nose while you beg for their product.

. . . I hate BP, but I admire them too, in the same way I respect the work ethic of serial killers. . . .Apparently BP has its own navy, a small air force, and enough money to build floating cities on the sea, most of which are still upright. If there's oil on the moon, BP will be the first to send a hose into space and suck on the moon until it's the size of a grapefruit. As an investor, that's the side I want to be on, with BP, not the loser moon.

. . . Let's talk about morality. Can you justify owning stock in companies that are treating the Earth like a prison pillow with a crayon face? Of course you can, but it takes some mental gymnastics. I'm here to help.
If you buy stock in a despicable company, it means some of the previous owners of that company sold it to you. If the stock then rises more than the market average, you successfully screwed the previous owners of the hated company. That's exactly like justice, only better because you made a profit. Then you can sell your stocks for a gain and donate all of your earnings to good causes, such as education for your own kids.
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Old 06-07-2010, 02:54 PM   #2
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Very funny article! Needed a laugh today. I loved the cartoon too:
Attached Images
File Type: jpg Dilbert BP.jpg (23.9 KB, 239 views)
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Old 06-07-2010, 04:26 PM   #3
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IIRC Scott Adam is a long time holder of Berkshire stock.

I own, or will own, if the price gets low enough, lots of evil company stocks including Altria, BP,Chevron, Wells Fargo and other banks stocks and lots companies involved in transporting oil and natural gas.

Evil is profitable>

But you shouldn't take advice from a cartoonist or me.
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Old 06-07-2010, 06:45 PM   #4
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I own, or will own, if the price gets low enough, lots of evil company stocks including Altria, BP,Chevron, Wells Fargo and other banks stocks and lots companies involved in transporting oil and natural gas.
Evil is profitable>
Crime pays... qualified dividends.
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Old 06-08-2010, 12:14 PM   #5
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I should have picked up those tobacco companies!

Oh well I am hanging on to Exxon-Mobil.
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Old 06-08-2010, 12:34 PM   #6
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I own RAI... and thinking about BP but waiting to see how low it can get. I like bargains. Let's see, buy low, sell high...

I've got a lot of energy stocks as well. I've moved into stocks that pay big dividends and also have capital gain potential, lately (as I quickly approach ER).
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Old 06-10-2010, 03:19 PM   #7
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Shudda bought BP yesterday, up 15% today.
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Old 06-10-2010, 03:45 PM   #8
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Shudda bought BP yesterday, up 15% today.
If you'd bought BP yesterday then tomorrow would you hold, sell, or buy more?

I'm sure that the hurricane season, the deepwater equipment, and (most of all) BP's shoe-leather-chomping executive staff will give you several more buying opportunities before this is over. I bet a few Gulf state lawsuits in federal court would liven things up too.

But now it's time for the media to turn their attention to the relief well(s) and to the next six months' cash-flow projections vs. anticipated dividend coverage...
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Old 06-10-2010, 08:18 PM   #9
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Quote:
Originally Posted by clifp View Post
IIRC Scott Adam is a long time holder of Berkshire stock.

I own, or will own, if the price gets low enough, lots of evil company stocks including Altria, BP,Chevron, Wells Fargo and other banks stocks and lots companies involved in transporting oil and natural gas.

Evil is profitable>

But you shouldn't take advice from a cartoonist or me.
All very true. I think its in our best interest to keep BP solvent so they can pay the bill..... not the tax payers.
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Old 06-11-2010, 02:05 PM   #10
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Quote:
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If you'd bought BP yesterday then tomorrow would you hold, sell, or buy more?
I would have sold for a quick profit. I expect this to end badly for BP. The question is how badly? $30 or maybe $15? Not $60 for sure.
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Old 06-12-2010, 10:04 AM   #11
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I don't know that this will end up being that big of a deal for BP. Exxon had big judgements against it, but in the end they paid a relatively small amount in damages 20 years latter.

Granted, this is going to be worse than the Valdez. It's a bigger spill, and there are alot more economic interests that have been hurt.

However, even if BP ends up paying $50 billion 20 years from now, they will survive and are probably worth buying at the current price.

I would bet that they will end up paying a much smaller amount than that in the end.

Note-- I have no position in BP, just starting to get interested.


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I would have sold for a quick profit. I expect this to end badly for BP. The question is how badly? $30 or maybe $15? Not $60 for sure.
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Old 06-12-2010, 10:14 AM   #12
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Originally Posted by kcowan View Post
I should have picked up those tobacco companies!

Oh well I am hanging on to Exxon-Mobil.
This week's TD Waterhouse video on dividend stocks is recommending Exxon-Mobil because it has truckloads of cash, a good PE ratio, and can take advantage of BP's misfortune.
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Old 07-25-2010, 06:21 AM   #13
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I am looking into COP instead. Y 4.09% PE 14.1 Net profit 3.5% They have increased YTD (5 yrs) 5% where Exxon mobile hasn't. Did I miss anything?
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