Investment "Logic"

Notes: Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning. Begin Text Here I wanted to take some time to overview my portfolios performance for 2014, then have a brief conversation regarding the holdings I currently have and my future plans as I get a clean slate to start anew and attempt to outperform the performance of the S&P 500 index.  Before I begin, I want to establish some common thoughts throughout this post.  First all gain/loss percentages discussed are based upon either feedback from my portfolio tracking software or by pulling up tickers on the Google Finance web page and looking at 1 year charts as of Jan 1 2015.  Numbers I state have the chance of being off a few percentage poin...

Notes: Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning. The purpose of this discussion and review is to analyze the trades I made in 2014 - what went bad, what went well, and what's still undecided.  Hopefully we'll be able to glean some lessons from the experiences I've had and use those to become better in 2015 - so let's dig in.  Below are all of the trades I made this year.  I'm going to try to break things down stock by stock, not trade by trade, but I'll do my best to keep all of this straight. Trades Made in 2014 The most obvious place to focus consists with the 4 trades of Broadwind Energy (BWEN) that I made in the year.  Simply put, there isn't a single thing I ever di...

To begin with, I sold out of my holdings in John Deere (DE) this week, though not at the prices I wanted to.  By doing this, I've raised some needed cash (now 12.9% of my portfolio) and have lowered the number of holdings so that I'm closer to where I'd like to be.  I anticipate some difficult times ahead for that stock, but we may revisit it again later. Outside of this, the week was rather spectacular.  Very solid earnings from Home Depot launched that stock on the week and we finally saw much stronger results from On Semi and Citigroup.  The various plots of political unrest continue to play games with the market.  For the upcoming week, there are no conference calls to be prepared for and no other key information.  In fact, this will likely be the lightest volume week of the year as investors of all types prepare for the long labor day weekend.  Low volumes really don't indicate price action.  The market can be just as volatile as it ha...

Notes: Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning. As stated in my summary last week, I ranked Deere a 4, meaning I was looking to get out.  Unfortunately, I overstayed my welcome - not selling yesterday when the stock hit $86 as I was intending to do.  Today it got a downgrade and announced more layoffs and as such, I sold my entire lot at $84.85.  While odds are good that I panicked some, I feel this was the right choice to reduce my stock exposure (I'm have too many holdings right now) as well as protect myself from losing money.  I did capture some meager gains, but clearly I left the majority on the table as I should've sold off a couple months ago in the 90s.  This is w...

So we've completed another week midst worldwide turmoil.  Putin continues to play "I love them, I love them not" with Ukraine, Israel and Hammas continue to declare moments of peace, only to have one side or the other fire rockets before the period completes pointing their fingers at the other side while they tell the world who did it, like 2-year olds.  Finally you have ISIS playing the school bully to all of the Kurds in Iraq to the point that they were stranded in the mountains and the US is using air attacks to help get them out of there.  All of this and somehow the market goes up over a percent and at the same time the 10-year treasuries climb (dropping yields) as well.  My portfolio continues to under perform as both Deere and NPS Pharmaceuticals are the driving reasons to my drop in value.  I'm starting to understand what the times look like and how/why my portfolio is under performing.  What I don't seem to know yet is whether I just deal with ...

Notes: Stock Ratings: 1 = buy at current stock prices, 2 = buy on a 5-10% dip in stock price, 3 = sell on a 5-10% increase in stock price, 4 = sell at current stock prices to raise cash.  Ratings are based upon 12-18 month outlook on stock direction and not necessarily related to moves I make due to financial positioning. On Wednesday, John Deere announced their fiscal third quarter results for 2014.  While the past results were rather strong with earnings of $2.33 on $9.5 Billion in sales, it was the forward guidance and leadership comments that caused a lot of concern for where the company and stock is heading.  While I say that results were strong, it's also a matter of comparing what I'm saying they were strong against, which in this case was analyst estimates.  Comparing sales and earnings to a year ago, the results were down 5% and 9% respectively.  This is an indication to the direction in which the company is heading.  They're not growing, ...

For a week riddled with a boat load of geopolitical issues, my portfolio fared decently, gaining half a percent on the week.  Industrials were getting hit hard over the week and had it not been so large a position, I'd be buying Honeywell when it was around $90 after pulling back 7% from its highs.  Other themes that are starting to show some strength is the companies that are national, rather than international.  This should help stocks like Home Depot and Broadwind, though the Russian situation, in particular, adds more risk to the price direction of Pepsico and On Semiconductor.  The former because they have a segment of business in Russia from when they bought one of the largest dairy companies in the country a couple years ago.  The latter because a lot of their business relies on Europe, where economic growth is likely to be hampered by all of the sanctions and tensions with Russia. Only one company in my portfolio reports this week and that's John ...

It was a good news, bad news kind of week.  Good news: both companies reporting this week provided strong quarters with raised guidance.  Pepsico beat estimates along with the guidance upgrade, whereas Encana missed the earnings estimates.  The bad news?  My portfolio was down on the week despite the good news.    Looking forward into the next week, I have two more earnings reports coming.  Both occur on Thursday as a speculation bonanza comes forth.  Braodwind Energy announces in the morning, with earnings estimates slated at $0.09 and revenues at $63.03 Million.  The company just announced contract deals which closed for tower orders for 2015, putting them at 66% filled for the year with more on the way.  CEO announced that he was confident in the continued growth of the company, so this will be the time to help make it count. Removed comments regarding NPS Pharmaceuticals reporting this week.  This was an incorrect statem...

Despite what was a bit of a roller coaster ride for my portfolio, it ended flat to up slightly.  This was about in line with the S&P 500.  Major drivers to the market over the week were a combination of earnings reports, which were strong for stocks I held, and all of the negative news between a passenger jet being shot down over Ukraine and heated battles between Israel and Hammas escalating through the course of the week.  The latter continues and could end up putting a damper in the market when we open on Monday.  Overall, though, I expect to see continued volatility driven by the market trying to determine fair value when taking into consideration of risks of international actions coupled with results from earnings reports as we enter one of the busiest weeks, generally speaking.  As for my portfolio, I only have two companies reporting - Pepsico on Wednesday, and Encana on Thursday. Pepsico will be announcing their second quarter earnings results on W...