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

To: Paul Senior who wrote (52611)	10/26/2013 1:53:13 PM
From: Jim P.	Read Replies (1) \| Respond to of 78774

Don't buy anything is sometimes difficult. I manage my parent's investment account and my dad has been very critical of cash in the account. There are times when I have been on margin for a year or 2 but there is nothing better than having some cash when a sector gets take to the wood shed. I find having to sell something to buy something puts me in a "trader" mentality in stead of "investor" mentality. I think cash is under rated as there is a "lost opportunity" cost (impossible to measure) instead of the known comparison cost of competing investments. I have more cash in my portfolio as a percent of assets than I can remember...over 25%. My parent's are 99% invested but some of the covered calls sold should result in stock sales. Stocks that I added this year when they became unpopular are Potash Corp, Peabody Coal and Alon USA Partners. jim

To: Paul Senior who wrote (52611)	10/26/2013 2:36:42 PM
From: E_K_S	Read Replies (1) \| Respond to of 78774

Hi Paul - Value stocks or just continued lagers? What about Joy Global, Inc. (NYSE: JOY) and/or Caterpillar Inc. (NYSE: CAT). I own neither but as they are out of favor (mining sector in a slump) and at/near the low of their cycle, it "may" be a good time (soon) to look at them as value plays. I do think if we stay in a low interest rate environment, some of the industrial stocks might do well. For me, I am now looking at those that are dividend payers and continue to raise their dividend. My focus are those w/ operations located in the U.S. but I am not excluding others that are not. With a challenged world economy especially in Spain, Italy & Greece. I am going to error on U.S. low leverage businesses until I can see that a recovery has gained traction. There are still a lot of NG and NG related industrial companies that are ok to buy (not exceptional value buys) and many of these are smaller mid cap and small cap companies. National Oilwell Varco, Inc. (NOV) was one mentioned and continues to do well. Still a marginal value play IMO w/ 13 forward PE and exceptional debt profile of only 1.83x net income/LT debt. Remember, the market is pricing in a low interest rate environment, maybe as long as 10 years. With that in mind, the value proposition is more about TBV, quality of earnings, sustained earnings assuming low interest rates, modest growth and emerging technologies and/or disruptive "events" like Natural Gas and shale Oil discoveries. Kohlberg Kravis Roberts & Co. L.P. (KKR) was mentioned by Ditchdigger and could be a value buy. There is just not enough public history on this name. Balance sheet look good, flush w/ cash and low debt profile but not very transparent on how they structure their deals. They could be the beneficiaries of low interest rates but also could blow up if one or more of their private equity deals go sour. Maybe Eastman Kodak comes to mind? Oops they are BK since they never were able to change from the old technology to the new. I anticipate we will see a few more of these BK stories so try not to fall into those value traps. Corning Inc. (GLW) is still in value territory and is one of those old timers that do continue to evolve w/ new technologies maybe even 3M Company (MMM) too. No rush to Buy but definitely shopping as there always seems to be some type of value proposition out there either company specific and/or transforming sector opportunities. EKS

To: Paul Senior who wrote (52611)	10/26/2013 4:20:50 PM
From: Spekulatius	1 Recommendation Recommended By Jurgis Bekepuris Read Replies (2) \| Respond to of 78774

I agree on on JMHLY. This is a very well managed conglomerate that has shown good double digit earnings and book value growth, I like that they are still run by the Scottish founding family. I think JMHLY is basically buying into the LT growth of Asia, run by a good capital allocators. I have them on my buy list but don't have a position yet, I have been watching Swire Group, which is a little bit similar in some respect, but more concentrated in real estate and airlines (Cathay Pacific). I trades at a discounted 0.65x book. HK real estate is a little bit in a bubble though. From those two, I prefer Jardine, because they own better business and have a better LT growth record.

To: Paul Senior who wrote (52611)	10/26/2013 8:10:24 PM
From: Elroy	1 Recommendation Recommended By tsigprofit Read Replies (2) \| Respond to of 78774

What to do with cash? Why not park your cash in a basket of BDCs? Stocks like PSEC and TICC seem to reliably pay out ~10%-12% dividends, even if you get some share price declines it seems reasonably safe to expect ~4% return over the course of a year, and maybe as high as 16% if you buy them when they're cheap relative to book value. They aren't really companies with business operations, but as far as reasonably safe high yielders they seem attractive.

To: Paul Senior who wrote (52611)	10/28/2013 2:00:35 AM
From: Jurgis Bekepuris	1 Recommendation Recommended By tsigprofit Respond to of 78774

What to do with cash? The best answer, just imo of course, backed up with my reading of what successful value pro value investors say/do, is this: When there's nothing to buy, don't buy anything. Yes. :) I have trouble just doing nothing. Me too. :) KOF - not interested: expensive, while results look mediocre. I'd rather hold some of my existing overvalued positions. :) Or buy some supercompany like COST (or more TJX :)). I'll take a look at JMHLY