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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (30474)	3/29/2008 12:27:10 PM
From: E_K_S	Read Replies (1) \| Respond to of 78704

Hi Paul - When evaluating your GM investment, what is your expected holding period? Looking at the recent option activity for GM implies that there is still expectations for a wide variance (over 45%) in the price (+/- $8/share) over the next 12 month period. I am bullish long term for GM (>60 months) as they have significant opportunities for growth in China and India. The stock will eventually turn higher once future expectations discount the worst case for GM. I am not quite sure we are there yet but do plan to add to my current position when we eventually get there. I think the value investor must look at holding longer (years) than shorter (months) in order to recognize the potential gains for GM. ================================================= The current returns on money market and other fixed income investments are getting so low now, that I am looking at deploying more money into undervalued equities and income producing Trusts. If the current dividend holds for GM, the current return looks quite attractive compared to my treasury yields. At this point in the cycle, I am looking at increasing my Canadian Energy Trust positions (my favorites are PWE & ERF) as I can lock in 4x's the monthly income than with my GNMA's and Treasury positions. My plan is to begin to peel off gains from these conservative fixed income holdings and deploy these funds into (1) Energy Trusts to produce an equivalent monthly cash flow (about 25% of the funds) and (2) use the other 75% of the proceeds to begin building new positions in undervalued equities that I can harvest in 3-5 years. This is a transition process rather than an "all or none" trade. GM is certainly one candidate that fits my equity pick criteria. Other include, HD, BMY, SGP, INTC (raised their dividend last week to 2.7%),CMCSA & MSFT. I do favor energy and pipe line special situations but also would like to increase my exposure to international companies particularly those located in Brazil. However at this time, the deep value plays seem to be in the domestic mid-cap companies. EKS

To: Paul Senior who wrote (30474)	3/29/2008 1:50:16 PM
From: Broken_Clock	Respond to of 78704

Paul I don't know how the general hotel industry is doing but things are going from bad to worse in Hawaii. The Ilikai is a prime location in Waikiki and they are laying off 2/3 of staff since they only have 30% bookings next month. Tourism is way down on the Big Island too. Maybe the mainland is different but i wouldn't bet on it.

To: Paul Senior who wrote (30474)	3/30/2008 2:23:24 AM
From: Spekulatius	Read Replies (1) \| Respond to of 78704

GM - if you just expect Gm to limb along, i would just buy some senior debt. there are some 7%+ bonds for 25$ nominal value around that trade for 15$ or thereabouts, yielding 12%. They would be paying out even if GM's dividend it cut to zero.