re: UNM
hi, paul. i sold all of my UNUMProvident at $22 (save a taxable $15 lot bought 2/2000) last month figuring i would have opportunities to add later. i am flat on UNM since i started talking about it, ahead if you count the dividends. i think i'll wait for the $15s on it. $15.50 would put it at 61% of book. First Call PE is about 7 on 12/2002 estimates as i write.
i've been buying this week.
Wind River Systems (WIND) at $3+. Current trailing market cap to sales is .72. I believe it's the leader in embedded real-time operating system software and it seems like an important technology to me. Balance sheet seems okay. I've made money on WIND by buying and selling at higher levels.
Siebel Systems (SEBL) at $5.5. The leader in CRM software. If you take away $1 billion in surplus cash from the market cap, the trailing market cap to sales is about 1x.
FYI, on both these software companies the forward sales are falling.
I added to United Rentals (URI) at $7. I've lost money on this one but I sold a bunch at $27. The company rents equipment so it's pretty cyclical. Moody's rates the senior debt ba3 so the balance sheet is weak. However, price to book is .37 and price to sales is .25. It's supposed to earn over $1. I don't know how much of that is cash, though. The company's growth history and prospects are excellent. Renting instead of buying equipment in order to reduce capital intensity on the part of customers seems to be a trend.
I added to Valero Energy (VLO) at $24. I liked it at $40, so.... Moody's rates the debt baa2. I hope whoever said that US refinery capacity is very limited in the long run is right. Right now there's a glut and VLO is making a small percentage of what they did in years past ($8.83 in 2001, $5.60 in 2000).
For the sake of completeness, I'll mention that I added to State Street, Morgan Stanley, and ADP, but I don't consider them value picks so I won't elaborate.
I started a position in Orthodontic Centers of America (OCA) at $9.30. OCA's accounting is controversial and there's some executive inbreeding. P/B is just over 1x. OCA is supposed to earn $1.54 but it's controversial how much of that is cash. The company is much bigger than any of its competitors in a market that has low penetration of big players so growth prospects seem good.
I bought CIT at $16. It's currently under $15. It's supposed to earn over $3. Price to book is under .75.
I added to Stilwell Financial (SV) at $10. It's supposed to earn over $1.
I added substantially at $15.50 to the Sabre Group (TSG), the global leader in travel distribution. TSG is supposed to earn $1.86 per First Call. First Call states expectations of 15% earnings growth over the next five years. I'm hoping for 12%.
I added to Safeway at $22. This is the now my biggest absolute loser ever. It's supposed to earn $2.81. I'm taking the contrarian position that the Wal-mart grocery push won't have the effect the market expects. I've taken my contrarian lumps right now.
I started a position in Diamond Offshore (DO) at $18.50. It's below its five year low. Moody's rates its debt a3.
I re-entered MONY Group (MNY) at $22 after selling at $47 in 12/2000. It's price to book is under 50%.
I started a position in Ralph Lauren (RL) at $17.50. The forward PE is under 10. I read an article about their business in the last year which made a vague but favorable impression. How's that for rigor?
I re-entered Robert Half (RHI) at about $12. This is below the price I paid in 1999. I sold that position for $34. Currently, the earnings are very weak. I started a small position hoping to add.
Finally, I started a position in Milacron (MZ) at $3.50. I believe this is a former s&P500 component. Yahoo: "Milacron Inc. is a global supplier of machines, tooling, supplies and services to a broad spectrum of plastics processing and metalworking industries." The company has not seen its stock price this low since before 1985 (as far back as yahoo goes). Price to trailing sales is .13, price to book .29. Moody's rates the debt ba3.
finance.yahoo.com |
