AIG is a Great Long-Term Investment

As you noticed in my blog, I often do buy and sell out of the same stock within the same year.  I often try to sell a year ahead to reduce the tax capital gains.  If you are looking at a great stock to do play long-term and that means you wish to invest, I recommend looking at AIG.  It did do poorly in the recession and they went to the brink of bankruptcy before being rescued by the US Government.

However, they are now poised in a path to grow and profit.  The stock chart shows this growth and it will continue to do great in many years to come.  Another great way to play is to use the AIG Warrants.  It’s a leveraged bet that will also do well.

I own both AIG Warrants and AIG.

Sprint Update

It has been a while since I posted in my blog.  FYI, I sold Sprint in June while it was in the mid-9s.  I don’t want anyone to take an investment and continue to hold thinking that I still own it.  I still think it is a great stock but there is a lot of competition.  The Softbank Mr. Son will do everything in his power to make Sprint a strong player in the US Market.  I think he will succeed but it will take too much time and there are so many great investments out there.

 

Ocwen is a Deep Value Play

On Friday, Ocwen Financial (OCN) took a nose-dive of 8.93% as they lost the loan deal with Wells Fargo.  They have dropped from a high of $60 to reaching $20 in one years time.  I would not have expected this company to continue to drop so much but with a price of $20 there is much pessimism priced into the stock.  They are going to do buybacks and they also have Seth Klarman who has bought large purchases in the third quarter.  Leon Cooperman sold out of his position though.

What are the risk?

They had a huge miss on earnings the past quarter and they also have substantial misses on the past 3 earning releases.  The company has fallen dramatically since the second quarter earnings.  The management repurchased 5.3 million shares at an average price of $29.92.  This is 50% higher than the current price of the stock. They also purchased 2 million additional stock at $23.63.  Management thinks their stock is too cheap and I wouldn’t doubt that they repurchase more in the future.

Why should I buy?

William Erbey is a really good CEO.  There is a lot of negative news priced into the stock right now.  If the company settles with regulations, there is a good chance that the price will rise significantly.  Also, if they continue to go the course, their stock should just go up because its priced as if its going to go to worse climate.

This is actually pretty risky but if there is a bottoming it might be a good play to make!  I would recommend watching for now!

Investing in Drug Companies

Investing in pharmaceutical companies are always risky.   Most of these companies are not making money but if they have one drug that works well, they can easily be bought out or make all the royalties back from their research and development.  It’s better if these companies already have a partnership with one of the behemoth drug companies that can help give them money and sponsor their drugs.

The company I’m talking about is Theravance (THRX).  Seth Klarman owns a majority of this company in his portfolio.  His basis is much higher than the current price of the stock.  It has hit weakness the past couple of quarters but there has been really good guidance going forward and growth should happen in 2015 and 2016.  GlaxoSmithKline recently purchased 832,456 shares of Theravance costing them a total of $12,786,524.16.  With such a large purchase, they are really betting on their drugs and I assume they eventually would like to buy them out.

This is a risky place but if THRX does well, it could be a great benefit to the stockholders.

Ford F-150 means Big Stock Move Up!

Ford has started production on their new F-150 aluminum truck.  This is their best seller vehicle and this is poised to bring their stock back up.  There has been a lot of bearish pricing in the stock this year since they have not hit their numbers and their guidance has been down.  The reason is they are investing in the future.  They have spend lots of money on their new models and they are willing to sacrifice short-term gains for future growth.  This actually worked to their advantage.  Not only has gas price decreased significantly since the start of the year but customers still have aging cars that need to be salvaged.

They are in great position for 2015 and their stock is in a great position to be purchased!  Even if the stock doesn’t move at all, you still get a nice 3.5% dividend to be patient.  Try doing that in a money market account or CD.  You are paid to be patient.

Remember they still have a great line of vehicles coming out for 2015 including the Ford Mustang, C-MAX, Escort, and more.  I recommend getting in while its low.

Disclosure: I own F for the long-term potential gain.

Watch Blackberry (BBRY) and Sprint (S)

I got back into Blackberry a couple days ago.  I was supposed to set it a buy stop around $9.15 but I accidentally left it as a buy limit and I ended up buying it around $8.90.  Luckily, it has been working well.  Blackberry has a big contract with the US Government and the stock continues to proceed up.  I expect to continue to hold in the short-term until I see some type of topping formation.  It has been very strong and I plan to continue to hold into the strength.

Another stock I like is Sprint (S).  It has hit a bottom at the $9.00 level and it looks like it will now make a move upward.  I would set a stop around $8.88 in case it does plan to go down further.  I’m setting a really tight stop because I am assuming I am correct that it is time for the stock to move up.

Jamba Juice Ready to Sky-Rocket Back Up!!

Every year Jamba Juice (JMBA) goes through a cyclical cycle of bull and bear.  You will notice in the fall and winter time it is always bearish and it will bottom out.  In the spring and summer it becomes bullish and it rises high.   I personally think this is a great value investment, but for those that like to play trends, you can make more money playing this range.  The stock analysis looks good for this as a swing trade as well.

If you take a peek at the stock chart, you will notice it has already reached the bottom in the October and November months.  This is a double-bottom and it has strong support.  I’d expect JMBA to make new highs around $19 in the 2014 year.

I have gathered some fundamentals that will help you build this case.  First, the company is debt free.  Second, they are ramping up on JambaGO which is their express line of Jamba stores.  Target will be one of the stores that will be opening JambaGO.  I also expect them to continue growing the JambaGO in schools which should have a big impact for the long-term.  Third, they are opening franchises internationally.  This should continue to develop their brand.  Finally, they posted their first operating profit in 2013.

 

Year-End Tax Sell-Off

At the end of the year, there is usually a sell of stocks for people to do tax harvesting.  People will be finalizing their last transactions for the year and it benefits them to shift their stock portfolio for tax purposes and accounting.  This is also called asset allocation.  It gives investors a way to do portfolio balancing which makes sure their portfolio leans too strongly towards a specific industry or stock.

So far, the futures has been up this morning but I wouldn’t be surprised to see a sell off before the year-end.  I hope everyone had a great 2013 and 2014 continues to bring great fortune!

Ford Still Looking Strong

Ford has a big drop around 10% in the past week.  They had a conference call that stated they would be lowering 2014 forecasts.  This meant they would be in-line with 2013′s forecast, their profits would be less, their revenue would be still increasing, but the earnings would be less than they had forecasted in the past.  The profit margins were expected to be 10%+ but instead it will be in-line with 2013 at 8-10%.

This drop is a short-term occurrence that will be a small blip in their future.  Remember, they are still a small-cap car company if you compare them to Honda (HMC) and Toyota (T).  They will have 23 new cars coming out in 2014 and they stated the marketing budget would reduce their profit margins.  Yes, this is short-term weakness but for the long-term holder they will do really well.  Remember, by making this international play, they will become an international growth play not just a North American growth stock.

I sold my BlackBerry (BBRY) Shares

I am surprised by the run-up on the Blackberry stock.  The pop was much greater than I anticipated.  This morning I created a stop at $7.49.  The stock was currently trading around $7.60 and it was rising but I was already happy with the gains and I wanted to take some profits if it were to hit my new stop.  When I came back from doing my errands, I checked the BBRY stock ticker and found it closed at $7.06.  Click here for the current stock analysis on BBRY.

My stop had gone through and I had taken a profit of over $1 per share.  I’m quite happy with my gains and I hope to get a better entry in the future.  In the meantime, I’ll be looking at other stocks that provide me with another window of opportunity.  Of course, Blackberry stock can continue to go up but if it hits my target I’m open to selling.  Just remember the saying “buy low and sell high”, I felt I already hit the mark today.  If it goes below $6.50, I might plan to do another purchase but I will have to see volume to the upside as well.