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

To: Mr.Gogo who wrote (40691)	12/18/2010 1:26:23 AM
From: E_K_S	Read Replies (3) \| Respond to of 78519

Re: Drys I still have some very high priced shares from 2006 & 2008 that have a cost basis in the $18.00/share range. I recently bought an equivalent number of shares earlier this year in the $4.10/share range. I was going to book my loss on the higher priced shares next year but w/ the new tax bill, I decided to do it this year. When the dust settles, I will have my position established with a much lower cost basis. I still think DRYS could be valued in the $14.00/share range if (1) their deep ocean drilling subsidiary is able to lock in some long term lease contracts for their new rigs under construction and (2) BDI rates increase w/ economic expansion. The company still has tons of debt, the stock has been diluted over 400% w/ three different special stock offerings but the company is well positioned to take advantage of any extended uptrend in their business. My new position represents less than .5% of the portfolio but now with my new cost basis it provides me good exposure in this sector. Ultrapetrol (Bahamas) Ltd. (ULTR) is another shipper in the portfolio. It's a much larger position than DRYS. I have been building my position since 2008. My cost basis is quite low as I was lucky to add shares in the $2.00/share range in late 2008. My price target is $15.00/share by 2011-2012 as the company continues to benefit from their capital investments made in 2009-2010. Their three different business operations should do quite well as Brazil leads the world economic recovery. If you scan the thread for ULTR you can read my posts over the years. As you can see, I am patient w/ my investments and will continue to add shares over time if the company story remains compelling. My timing was a bit off on ULTR w/ my first buys occurring in early 2008 around $10.00/share. My high priced shares have been written down and the value proposition has improved significantly. This one will be a 4-5 year hold and I hope to sell my last shares in the $15/share-$18.00/share range. Every stock has it's own story and value proposition. I am working on cutting down my average holding period to 36 months. EKS