what are you selling today?

[Gregmal]

Sold to close OSTK $10 Sept calls

[Castanza]

Sold to close Aug 16 $17.5 calls at 76% gain. Could be more upside but I couldn't pass up 76% gain in a matter of 15 days. Might buy in again if there is a pullback.

[Gregmal]

Trimming CVS a bit

[Gregmal]

trimming some CLF

[Castanza]

Sold 75% of my HSY - Hershey position. Merely profit taking as it was my best performer this past year. Cost average was 95ish and sold today for 136. My thesis hasn't changed much on the company in general, but this rapid ramp up in price made me want to take some profits.

 

Edit: Tariff tensions are making me a bit uneasy with HSY. The three Mexican plants are quite important in supporting the North American supply chain. I'm uncertain how tariffs will affect the NA segment. NA makes up about 89% of HSY market where Brazil, MX, China, India make up most of the remaining market share. India is their fastest growing international market.

 

One thing I do like is Hershey owns all but 2(located in Georgia and NY) manufacturing plants. And in general, their products are manufactured in the marketplace which they will be selling. This helps reduce risk somewhat. Noticed a large surge in $125 August puts today and figured, might as well take profits. Honestly, this has been one of my best plays.

 

Link to the 10-k if anyone was interested. Don't think I've seen this stock covered on here.

 

https://www.thehersheycompany.com/content/dam/corporate-us/documents/annual-reports/2019-proxy-statement.pdf

 

Kicking myself one month later...who would have thought this was going to keep running?!

[Gregmal]

Sold last of my NXPI premarket at 102. Busted merger play that ended up producing a respectable shorter term IRR after trading around it(December helped big time).

 

Noticing a trend with this company that I'm not a fan of, and I'm already overweight GOOG, GM, and CIBR, which roundaboutly cover all the things I felt I liked about NXPI.

 

 

EDIT: Also sold last of my JOE; again, thanks December!

 

[Saluki]

 

 

EDIT: Also sold last of my JOE; again, thanks December!

 

Did you buy JOE in December?  If so, you did great.  I'm still a holder. 

 

Been selling off a little of HHC.  Still like the company and the assets, but I see some cheaper stuff out there and I'm overweight in real estate (also own SRG and TPHS).

[Gregmal]

 

 

EDIT: Also sold last of my JOE; again, thanks December!

 

Did you buy JOE in December?  If so, you did great.  I'm still a holder. 

 

Been selling off a little of HHC.  Still like the company and the assets, but I see some cheaper stuff out there and I'm overweight in real estate (also own SRG and TPHS).

 

Same deal for me, just somewhat different names. Too much cheap real estate. If I can easily determine a real estate company is sitting on assets(or debt) that won't turn the equity into a 0, just wait for a big enough pullback or margin of safety and then buy it on margin. The downside is not all of those can be long term holdings.

[alpha]

Sold my DF position for a nice return. I was planning to go long but recent run up isn't based on any fundamentals and tomorrows earnings report is likely to be more bad news.

[Cigarbutt]

Sold my DF position for a nice return. I was planning to go long but recent run up isn't based on any fundamentals and tomorrows earnings report is likely to be more bad news.

Impressive return during your holding period.

It seems that Mr. Market is offering another opportunity unless the latest report has changed your assessment of the fundamentals?

[KJP]

 

 

EDIT: Also sold last of my JOE; again, thanks December!

 

Did you buy JOE in December?  If so, you did great.  I'm still a holder. 

 

Been selling off a little of HHC.  Still like the company and the assets, but I see some cheaper stuff out there and I'm overweight in real estate (also own SRG and TPHS).

 

Same deal for me, just somewhat different names. Too much cheap real estate. If I can easily determine a real estate company is sitting on assets(or debt) that won't turn the equity into a 0, just wait for a big enough pullback or margin of safety and then buy it on margin. The downside is not all of those can be long term holdings.

 

I have learned that lesson via companies like Keck Seng, where compounding over long periods is hard if management overpays for assets.

 

Right now, I still hold HHC, but I'm more interested in adding to Griffin Industrial and FRP Holdings.  Griffin seems clearly undervalued to NAV, NAV appears to be growing, and you can see a 3-5 plan (maybe sooner) on how that gap would close, particularly if interest rates stay low.  FRP's NAV, on the other hand, is tougher to estimate, but you get to invest alongside the Bakers at the same prices (or lower) that they are buying back shares.  You could do much worse than simply giving the Bakers your money via FRP and watch them act prudently and harvest assets at the right time, as they've done many times in the past.  And if you want to see what a great asset looks, just look at what they don't sell -- royalties on rock piles.

 

One real-estate related company that I've haven't seen discussed on here is Canterbury Park Holdings.  That may interest some on here, but it's much more of a single asset real estate play, and the attached race track operating business is having issues.

[Gregmal]

 

 

EDIT: Also sold last of my JOE; again, thanks December!

 

Did you buy JOE in December?  If so, you did great.  I'm still a holder. 

 

Been selling off a little of HHC.  Still like the company and the assets, but I see some cheaper stuff out there and I'm overweight in real estate (also own SRG and TPHS).

 

Same deal for me, just somewhat different names. Too much cheap real estate. If I can easily determine a real estate company is sitting on assets(or debt) that won't turn the equity into a 0, just wait for a big enough pullback or margin of safety and then buy it on margin. The downside is not all of those can be long term holdings.

 

I have learned that lesson via companies like Keck Seng, where compounding over long periods is hard if management overpays for assets.

 

Right now, I still hold HHC, but I'm more interested in adding to Griffin Industrial and FRP Holdings.  Griffin seems clearly undervalued to NAV, NAV appears to be growing, and you can see a 3-5 plan (maybe sooner) on how that gap would close, particularly if interest rates stay low.  FRP's NAV, on the other hand, is tougher to estimate, but you get to invest alongside the Bakers at the same prices (or lower) that they are buying back shares.  You could do much worse than simply giving the Bakers your money via FRP and watch them act prudently and harvest assets at the right time, as they've done many times in the past.  And if you want to see what a great asset looks, just look at what they don't sell -- royalties on rock piles.

 

One real-estate related company that I've haven't seen discussed on here is Canterbury Park Holdings.  That may interest some on here, but it's much more of a single asset real estate play, and the attached race track operating business is having issues.

 

Aha! You've been using the same strategy? Buying below FRPH disclosed repurchase prices has worked well.

 

Have not heard of Canterbury. Sounds a little like Dover Downs. Thanks

[Spekulatius]

Sold REZI after the earnings report. I had reduced my position before the CC, but sold out after. While they made the revenue and earnings number, it was a very low quality report. Gross margin does and the pro forma # excludes the indemnity payment to HON (capped at $140M/ year). This payment is represented on the balance sheet as a $580M liability , but I think it will cost more. Anyway, thy have about $1.1B in debt (costing ~$70M in interest) and don’t seem to be able to generate any FCF currently. I misjudged this, it’s another crappo spinoff (GTX is a sinking ship also), so I take my 15% loss and move on.

 

KTB is doing better than I thought, also the earnings report is nothing to write home about either.

[Spekulatius]

Sold PRSP. Seems fully valued.

[Cigarbutt]

Sold another portion of the residual TLT (20-30 yr US gov. bond ETF) position.

Moving away from macro trends as this position makes less and less sense from a long term (and fundamental) point of view.

Have kept a smallish position in case the reflexive crowd takes over before the whatever it takes modern fiscal stimulus crowd does.

An interesting aspect is that the pre-defined trigger (price) for the sale of that portion was met before actual economic deterioration made it to the surface, a combination of divergence I never thought possible when this theme was developed in my portfolios years ago.

What is unfolding is absolutely fascinating.

[TwoCitiesCapital]

Sold another portion of the residual TLT (20-30 yr US gov. bond ETF) position.

Moving away from macro trends as this position makes less and less sense from a long term (and fundamental) point of view.

Have kept a smallish position in case the reflexive crowd takes over before the whatever it takes modern fiscal stimulus crowd does.

An interesting aspect is that the pre-defined trigger (price) for the sale of that portion was met before actual economic deterioration made it to the surface, a combination of divergence I never thought possible when this theme was developed in my portfolios years ago.

What is unfolding is absolutely fascinating.

 

I tend to agree. Bonds are literally screaming recession and stocks are still bumping along like it's not a big deal.

 

I wasn't old enough, or educated enough, to recall much of the events from 2000 and 2008 (other than I was the naive idiot buying banks, autos, and dry shippers in 2007/2008 ), but this seems crazy and I'm assuming is atypical.

 

It's not so much a divergence in performance that bothers me, but the divergence in the narrative.

 

Bonds are saying there's no need to be concerned with inflation and/or GDP growth is going to be muted for the next 30-years.

 

Stocks plucking along at high P/Es with near record margins suggests equity markets see no danger to nominal GDP growth/inflation.

 

I know I've sounded like a broken record since 2016, but my concern is contracting multiples on top of contracting earnings. Not hard to get a 60% decline in such a scenario.

 

[SHDL]

Sold another portion of the residual TLT (20-30 yr US gov. bond ETF) position.

Moving away from macro trends as this position makes less and less sense from a long term (and fundamental) point of view.

Have kept a smallish position in case the reflexive crowd takes over before the whatever it takes modern fiscal stimulus crowd does.

An interesting aspect is that the pre-defined trigger (price) for the sale of that portion was met before actual economic deterioration made it to the surface, a combination of divergence I never thought possible when this theme was developed in my portfolios years ago.

What is unfolding is absolutely fascinating.

 

I tend to agree. Bonds are literally screaming recession and stocks are still bumping along like it's not a big deal.

 

I wasn't old enough, or educated enough, to recall much of the events from 2000 and 2008 (other than I was the naive idiot buying banks, autos, and dry shippers in 2007/2008 ), but this seems crazy and I'm assuming is atypical.

 

It's not so much a divergence in performance that bothers me, but the divergence in the narrative.

 

Bonds are saying there's no need to be concerned with inflation and/or GDP growth is going to be muted for the next 30-years.

 

Stocks plucking along at high P/Es with near record margins suggests equity markets see no danger to nominal GDP growth/inflation.

 

I know I've sounded like a broken record since 2016, but my concern is contracting multiples on top of contracting earnings. Not hard to get a 60% decline in such a scenario.

 

Congrats to Cigarbutt and others for the successful trade.  I agree that it is probably a good idea to avoid overplaying this one.

 

Regarding the divergence between the bond and stock markets, I think the general consensus among macro traders has long been that the bond market tends to be the better forecaster.  This tendency may have strengthened in recent years by the rise of algorithmic trading and passive investing in equity markets.

 

I personally think the big long term risk for equities in general now is political, i.e., changes in regulations/taxes/etc that make businesses much less profitable.  We’re already seeing all sorts of signs pointing in that direction.  This is also the worst type of risk for investors IMO because it is the kind of thing that can potentially cause businesses to gradually lose their value over the course of many years and not recover. 

[Cardboard]

I think that you guys ignore that there are 2 stock markets: the hyped/new/very large high tech and the rest trading like a depression is coming.

 

Cardboard

[TwoCitiesCapital]

I think that you guys ignore that there are 2 stock markets: the hyped/new/very large high tech and the rest trading like a depression is coming.

 

Cardboard

 

I own oil stocks Cardboard. Along with other base metal royalty owners and producers, a few good miners, and a ton of EM exposure particularly to Russia.

 

I know where the market is cheap - but cheap sectors get cheaper in a recession so why blow the load and throw caution to the wind just because SOME areas are cheap now?

 

I'd rather wait for everything to get cheap and throw darts at the board.

[Spekulatius]

I wish puts were cheaper, but with a VIX if 19, puts are a no- go for me, so I raise some cash instead. I do share the aforementioned concerns.

[Gregmal]

Trimmed about 10% of my BX. Dont know what's wrong with this stock but it won't go down...

[Cigarbutt]

Trimmed about 10% of my BX. Dont know what's wrong with this stock but it won't go down...

-Have followed BX for a long time and thought they did very well bridging the 2007-9 period (well timed IPO, timely reversal to mortgage exposures).

-Since that time, the market return on BX has been more lumpy and to some extent better (especially if measured after the recent run) than the S&P index.

-Is Mr. Byron Wien still around? I felt he was an interesting contrarian input vs downside risk.

-Alternative asset managers have done very well in this investor post-traumatic stress syndrome and reaching for alternative yield world and, in retrospect, it's a good thing they didn't follow Mr. Wien's instincts.

-In the PE world, it seems to me that leveraged deals are more leveraged and coverage ratios are tighter. Is BX following the trend and is the reported carried interest at risk?

-In one sentence, where do you see BX in 5 to 10 years?

https://www.blackstone.com/media/press-releases/article/the-smartest-man-is-a-firedancer

https://www.blackstone.com/docs/default-source/black-papers/seeking-an-alternative_standard_v68_web.pdf?sfvrsn=fd0c2cad_22

 

Feel free not to answer or start a new thread.

FWIW, I'm still working on a life lesson mentioned by Mr. Wien some time ago:

"Younger people are naturally insecure and tend to overplay their accomplishments. Most people don't become comfortable with who they are until they're in their 40's. By that time they can underplay their achievements and become a nicer more likeable person. Try to get to that point as soon as you can."  :)

[Gregmal]

Paired down some CVS at $63. ~18% total return in about 6 months... still think its got some upside, but looking to raise some cash. Just another example of a super obvious, not going anywhere/will be around forever, blue chip with an above average yield and single digit pe....right there for the taking.. but yea, the markets overvalued...

[Castanza]

I wish puts were cheaper, but with a VIX if 19, puts are a no- go for me, so I raise some cash instead. I do share the aforementioned concerns.

 

Are you buying puts with the VIX around 16?

[Cardboard]

Gregmal is the smart guy here: buys cheap, quality stocks that he could hold on for a long time if they continue to drop and sells them for a nice profit (20-30%) if they rebound. Then rinse and repeat.

 

Seems to be the way to make money in this environment.