And returning to stock picking, fwiw, I added today to my small position in steel mill and metal fabricator, LTV Corp (LTV). Stock is at a new yearly low. (Sales and earnings are down.) At $5/sh, we have tangible book value of $15 -- okay,okay steel company book value- we know what that implies -g---but also, LTD/eq. is .2 (but will increase) and trades at under 3x cash and 4.3xEBITD. Interesting thing to me is that LTV itself has a market cap of $500M but they are buying Copperweld Corp. for $650M and another co. for $114M. From somewhere in all that there may eventually emerge booked profits. LTV has often traded between 10 and 15 (but not recently) since it emerged from bankruptcy. I expect it will trade there again within the next couple of years. (Although I've been disappointed in my expectations many, many times before.)
Also, FWIW, I'm trying to add to my small position in Catellus Development Corp. (CDX) if the stock goes under 11 (yearly low). CDX is a real estate developer (not a REIT) with large California land holdings, especially Mission Bay in San Francisco and Fremont (Silicon Valley). Analysts say this stock is worth more than $22. I am dangerously relying on reports of others both as to the underlying value as well as to the several fund managers who have said they own this stock (Cooperman, Whitman, Gabelli).
OT. And FWIW. I have taken a very small position in non value stock Quintiles Transnational (QTRN). Lot of negatives. Disappointing sales and earnings, insider sales, subsequent lawsuits. QTRN does research and sales for pharmaceutical companies. QTRN is the big gorilla in its business. Stock at 17 is selling near a 4 year low. Outsourcing trend in pharmaceuticals (as well as in everything else apparently) will likely continue (imo), and as the dominant company (imo) QTRN ought to be able to grow and be profitable. And the stock should recover. Of course, in the short term, the stock could continue on its present downward trend and then stay there for some time also.
Paul Senior |
