Tuesday, August 14, 2012

8/14/12 Warren Walks

http://finance.yahoo.com/news/buffetts-berkshire-slashes-stock-holdings-204257365.html http://247wallst.com/2012/08/14/major-changes-made-to-buffett-berkshire-hathaway-stakes/?Mod=MKTW Sells off all or part of holdings in INTC, JNJ, PG, KFT, IR and GE.

62 comments:

  1. Buffett walks! Now there's a confidence builder!

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  2. When insiders sell, it's usually no big deal- they sell for all kinds of reasons. When Buffett sells, IMO it is a big deal- Berkshire Hathaway is not known for high turnover.

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    1. SWC insiders were selling yesterday, they last bought at much higher prices (~$15?).

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    2. It looks like $ wise it was about a wash, no?

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    3. http://buzz.money.cnn.com/2012/08/14/george-soros-facebook/

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  3. TOF- Re- Gale...



    Net loss for the three months ended June 30, 2012 was $0.2 million or $0.003 per share on a basic and diluted basis, versus a net loss of $3.8 million, or $0.10 per share on a basic and diluted basis for the three months ended June 30, 2011.

    Operating loss from continuing operations for the three months ended June 30, 2012 was approximately $5.7 million compared with $2.3 million for the three months ended June 30, 2011. For the six months ended June 30, 2012, operating loss from continuing operations was $10.1 million compared with $5.5 million for the six months ended June 30, 2011. Loss from discontinued operations was $0.4 million for the three months ended June 30, 2012, as compared to $2.2 million for the three months ended June 30, 2011. Loss from discontinued operations was $1.6 million for the six months ended June 30, 2012 as compared to $4.3 million for the six months ended June 30, 2011. The period to period changes in net income, loss from continued operations and net loss from discontinued operations are primarily driven by the spin-off of our former RXi Pharmaceuticals subsidiary on April 27, 2012 and the related focus of our continuing operations on our late-stage NeuVax product candidate.

    Other income for the three months ended June 30, 2012 was $5.9 million versus other income of $0.7 million for the three months ended June 30, 2011.

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  4. 13G's...Well, it looks like EVERYONE bailed on the financials. I guess that business model is dead.

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    1. The small regional banks stocks I own are continuing to do well and their business is improving.

      I would avoid the large bankers like BAC, C, etc. They are too easy targets to go after and are still cleaning up their messes from the last cycle. I think their underlying businesses are still good, but too much headline and regulatory risk - maybe 2013 or 2014?

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  5. TOF,

    I appreciate your comments on not shorting bonds and just buying stocks. That is what I will probably do, but it sure does look like some big money will be made doing this *if you get the timing right*


    The other thing I was thinking about over the weekend is that you have this giant pool of investment money out in the world that has to go somewhere. Too much of this money has gone into bonds and driven prices too high. This money will come out over time and can either go into stocks, commodities or real estate -> commodities and real estate can be played through the stock market as well. Picking the right asset class now is key to outperformance over the next few years for the big funds, so figuring this out and getting ahead of them will be a good way to make money.

    Commodities were the general winner for the last decade and a number of "visionaries" are saying we are only half way through a 2-decade bull market and we are just in a correction here. U.S. housing appears to have bottomed, but normally you wouldn't expect an immediate bull to start, but rather a long period of base building. Stocks appear generally cheap, and you read that funds are underinvested, but that profit margins are too high and unsustainable.

    Haven't really come to any conclusion yet, but mainly invested in stocks at the current time.

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  6. Interesting that Buffet is cutting back on consumer staples type companies and putting the money to work in energy and financials. He was saying on TV a couple of weeks ago that he wasn't too happy with J&J's performance.

    My personal top 2 industry holdings are also financials and energy - hopefully that means I am in good company!

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    1. BB - Check out BKJ, a tiny regional bank (with little liquidity) that continues to just kill earnings. I honestly have no idea why that isn't trading at $15. It also pays a 3% dividend but it has a history of paying total dividends (including special divs) of 6%.

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  7. wow...they're really bashing NOK in the news. i see downgrades galore etc. Yet the stock is up? hmm....

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    1. Could be a sign of no sellers left.

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    2. yup. that's my thinking. it's a crap shoot right now but i think the company has the resources and the cash to turn it around and be a $5 to $7 stock within 12 months.

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    3. According to the Gartner report this week, Nokia still had 19.9% of mobile device sales last quarter, so still racking up the units sold - the issue is smartphone sales strategy is still weak and that is where the market is going and if Windows Mobile fails, they will be in a tough spot (like RIMM).

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    4. yeah that's why i think it runs into the Windows 8 launch....at which point i will probably sell some and hope for a dip to buy back.

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    5. The bashing seems positive for pps.... Bashers trying to keep it from moving up too fast while they cover?

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  8. Mark - I don't follow GALE although maybe I should. Awesome chart. My guess with the other income is royalty payments? I have no idea.

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  9. Dow Jones Credit Suisse Core Hedge Fund Index up 1.45% YTD (July month-end) vs. S&P 500 up 11.01% http://www.hedgeindex.com/hedgeindex/en/default.aspx?cy=USD

    A lot of hedge funds still underperforming - this could lead to perfomance chasing where any small pullback is bought leading to a steady uptrend in the markets.

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    1. BB - This is part of the reason I see a massive squeeze into year end after a pullback. We need one more pullback to get the big boys on board that have missed this run. I think what makes sense is a pullback to 1,320-1,330 to allow the hedgies and big bond investors a final chance to get long, then a straight shot up to 1,500 to close out the year. any pullback we do get will be short and sweet so I'd rather stay long and look to buy any dip if possible.

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  10. Long DMND again at 17.95.

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  11. Kaas pressing his short.

    TOF- It's really hard to get any good info on GALE. I don't think they have CC's from what I can tell.

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    1. dude - NSPH. yikes.

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    2. Don't think I'm not watching. They revised the article to '200 have shown interest'...

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  12. F- OK, I give up. Taking my profits here. 9.49

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  13. http://www.youtube.com/watch?v=gMShFx5rThI

    I'm sure you guys have seen this. This is a big reason why we see these massive headfakes...and why we should almost always look at breakouts/breakdowns as opportunities to go the other way.

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    1. "Go the other way"

      Yeah, like expecting the indexes will fall as T's sell off for instance, that's my idea of going the other way...

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  14. CHD - This thing isn't dropping as I'd hoped, not much is meeting my expectation of lower prices...

    So when's the most likely schedule for the hammer drop? The earliest date I've been able to identify is a month from now, Sept 12th, when Germany makes their next bailout decision.

    Not sure when euroleaders return from their vacations though. For all I know, they could be in front of a camera looking like they just stepped off a surfboard while I type.

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  15. Treasury rates - I see rates rise and I think to myself:

    1) Higher rates aren't economically stimulative (not withstanding the fact we're at record low rates right now!).

    2) The money coming out of T's must be going somewhere (assuming it's just not funny money that disappears and reappears from a third dimension somewhere).

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  16. $UTIL - $482.33 looks like an important resistance level.

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  17. Pretty quiet. Perfect set-up for the kind of breakout game(s) referenced above. It's never that easy, though. I've heard seasoned traders come up with both (a) 'fade the first move,' and (b) 'the initial move will be in the direction of ultimate price resolution.' In other words, there can be so many head fakes these days, it's not unlike my favorite table game.

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    1. i guess i was referring more to individual stocks. just in the stocks i follow, i've seen multiple false breakdowns before huge moves higher in the past month or two:

      INVN
      FSLR
      DMND
      SVNT
      NOK
      FIO
      NILE

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  18. BBBY and FL are major sells longer term in my opinion. If you look across the board at big retailers that have gotten crushed by Amazon like RSH, BBY, SPLS, etc, I just don't see how these two survive unscathed. Maybe I'm wrong and maybe the perception of Amazon isn't strong enough in these sectors.

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  19. Offed KCG/ GRPN @ 2.99/ 5.39 for minor losses. Pointless trades.

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    1. Let me rephrase that. Idiotic trades. The curse of human nature.

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  20. Is it just the normal ringing in my ears, or is that the faint sound of a magic flute I hear coming from down by the river?

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    1. No, that's just me screaming while I pull my hair out to stay awake.

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    2. Its the August lull - you see why they say a lot of professional traders take vacation now.

      If you are quick though, somtimes some great deals pop up as someone is trying to sell too much fast.

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  21. http://allthingsd.com/20120815/aiming-to-precede-new-iphone-nokia-and-microsoft-schedule-sep-5-event/?reflink=ATD_yahoo_ticker

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  22. TOF. nice buy on DMND this morning.

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    1. thanks. i actually just sold and bought more NOK at 2.62.

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  23. http://finance.yahoo.com/q/op?s=NOK&m=2012-09

    Look at that vol on the Sept $3 Calls.

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  24. CP,

    I don't think that much money has been coming out of treasuries yet - think of the years of inflows we've had into bond funds - that will take a long time to come out.

    Also, many investors wont withdraw quickly as they've been conditioned that bonds are the safe, money making place. They need to see some losses before they start selling.

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  25. 2nd, are you long anything now or out of the market?

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  26. wow what a day for SVNT. i almost pulled the trigger at $0.86.

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  27. And the crowd goes wild!

    BB - Thanks for sharing your insight, will digest following a brief personal intermission!

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  28. $UTIL closed in the red and below today's support...

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    1. Utilities should go down with bonds. Some are saying they are 30% overvalued compared to traditional metrics as people chase yield and I find it hard to find a utility I'd want to buy.

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    2. Me too. Although I have liked LG until it got a bit more expensive.

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  29. Interesting that fundamental investors Kass yesterday and Marc Faber today, both saying the market is going to go down because of technical reasons (Kass - triple top; Faber - fewer Nasdaq highs). Kass said the top of the market for the year is probably in and CNBC twisted Faber's words a bit to flash the same thing on the screen.

    Not sure what it means when the fundie guys start doing technical trading, but have to wonder if they are stretching to make stats fit their thesis because perhaps the fundies don't support what they want.

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    1. when you're in a sideways market for 13 years people expect the same trading ranges to occur forever. so people change their strategies to fit the market they are in, usually at the tail end of the market's pattern. then a new trend emerges and people get stuck on the strategies that worked previously. while i don't think we're off to a new bull market yet, i do expect us to hit a new all time high again before one final mini-bear market. we need everyone to assume that we're going to stay in this range forever. i think that happens with another 25% drop after we hit new all time market highs.

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    2. BB - Right now I think the best possible investment returns people can make will come from those stocks / sectors that have been beaten down the most. Just look at the returns you could have made in MITK, NOK and FSLR for example. FSLR is up almost 100% from the lows and 50% from the point it "stalled" at a few weeks ago. MITK went up almost 150%. NOK has "stalled" at the $2.4 to $2.6 level or up about 60% from lows. I'm pretty sure it will be up 50% from this level within the next few months.

      What are some others? EWP, EWI, DMND, JVA, GRVY, REDF, NBG, ANR, BTU, JRCC, ACI, shippers like NM etc. Let's just ignore the market for the time being, though, and focus on these ridiculously trashed stocks. Several of these will make life changing gains over the next year or two.

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  30. This comment has been removed by the author.

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  31. Checked out SOH for the first time in months. So Fing funny. Same guys who have been bearish all the way are now saying..."1500 first, then oh baby, watch out. Will make 2008 look like a bull market..."

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