Tuesday, January 27, 2009

Louis Navellier and CF

On a hot June 29th 2008 Louis Navellier wrote his July issue of Blue Chip Growth.
One of the new buys (and of course one of the Top 5 stocks) for July was CF Industries (CF).

CF Industries (CF) is a regional agricultural firm that manufactures and markets nitrogenous and phosphate fertilizers. The company operates a network of manufacturing and distribution facilities, primarily in the Midwest. Before it began to trade publicly in 2005, the company had been owned by eight regional agricultural co-ops, including Land O’Lakes, Growmark and CHS.
Fertilizer companies are prospering because farmers need to boost crop yields to meet the global demand for food. CF is no different, benefiting from positive analyst upgrades and trading at less than nine times forecasted earnings. The stock is a great buy below $176.

A few pages later Mr. navellier was writing Buy Below $174.

In any case, he got in at $155.08 and suggested his readers to do the same.
During the first months CF moved sideway and Mr. Navellier appeared on Bloomberg TV to tell he was positive about fertilizers.
In the following issues of Blue Chip Growth he wrote:
August 2008 issue: Top 5 Stocks: #1. Fertilizer giant CF Industries (CF) managed to claw back from the panic selling in early July, and it has the fundamentals we require to shine this earnings season. Demand for CF products remains strong amid the global food crunch, and I expect that to be reflected in a strong quarterly report.
Buy Below $186
September 2008 issue: Top 5 Stocks: #2. Agricultural chemical producer CF Industries (CF) posted the second-biggest earnings surprise of all our Blue Chip Growth stocks this quarter, at a stunning 39.4%. This company’s 2Q profits were more than three times those of 2007! The stock has pulled back a bit recently because of the profit taking affecting all of our commodity stocks, but numbers like that won’t go unrecognized by Wall Street for long. Because of its tremendous earnings performance and revised outlook for the second half of the year, I still think CF is one of the best stocks on our Buy List.
Buy Below $144 (and those who bought it over $160 one month earlier?)
October 2008 issue: Buy Below $138
November 2008 issue: Buy Below $72 (CF already lost over 50% from its top. What was Mr. navellier waiting?)
December 2008 issue: The stocks with the strongest profits remain our fertilizer stocks, which were simply stunning, with Agrium (AGU), CF Industries (CF), Mosaic (MOS) and Potash (POT) all posting better-than-expected earnings and over 100% sales growth. If you doubted whether our ag picks were worth holding on to, I hope this helped prove that these companies still have a lot of strength.
Buy Below $60.
January 2009 issue: Buy Below $55.
February 2009 issue: SELL CF. On January 20th, when the PDF February issue was saved, CF closed at $45.74.

For Mr. Navellier this trade generated a 70% loss.

What a guru...


Anonymous said...

Since, CF has gained almost 50% and gone up past 70. If you bought below 60, at the end, you'd be in good shape. But that guy did suck at life for a couple months (as did every other investor).

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