Friday, March 27, 2009

Louis Navellier and CF - Missed missed missed

Between January and February 2009 Louis Navellier closed his position on CF for his services BlueChip Growth and Emerging Growth.

The sell price was between $45 and $54, as you can check here.

CF is currently trading at around $74. That is a 37% to 64% missed profit for the "icon of growth investing".



Tuesday, March 24, 2009

Robert Hsu and SH

March 5th 2009
U.S. Stock Market in Freefall
The bloodbath continued this week as more bad news sent the global stock markets reeling. As a result of deepened economic recession and financial crisis, the U.S. stock market traded off early this week with the Dow plunging below 7,000 on Monday for the first time since 1997 and falling closer to my low-end target of 6,500 at today's close. In addition, the S&P 500 dipped to its first close below 700 since October 1996.Year to date, both the Dow and S&P 500 have dropped more than 20%.
The freefall in U.S.-traded shares is a direct result of the deteriorating economy in the U.S. In the fourth quarter, the U.S. economy contracted far more than previous estimate of 3.8%. U.S. GDP shrank at a 6.2% annual pace from the third quarter, which is the fastest contraction since 1982. This slowing in GDP was greatly due to the 4.3% drop in consumer spending in the fourth quarter -- the most since 1980.
I expect the economic picture in the U.S. will grow darker before things get better. That's because many U.S. companies continue to lay off employees, U.S. banks continue to tighten their lending and housing prices continue to fall. And consumers are feeling the pain, as well as many U.S. corporations. According to Bloomberg, fourth-quarter earnings declined 58% on average for the 465 companies in the S&P 500 that have reported results since January 12.
This is a vicious cycle. The U.S. is suffering from a much deeper recession than originally thought, and President Barack Obama's $787 billion stimulus package won't have a much of an impact until the end of 2009 -- at the earliest. That's why I expect more economic deterioration in the U.S., and for U.S. stocks to face an even bigger downside risk this year.
New Buy: ProShares Short S&P 500
So this week, I want to provide you with a way to hedge our China Strategy portfolio by shorting U.S. market. The option available to investors like us is the ProShares Short S&P 500 (NYSE: SH). This ETF "shorts" the market -- betting that U.S. stock prices will fall -- by using combinations of stocks, index futures and other derivatives that increase in value when stock prices tumble. It tracks daily investment results that correspond to the inverse of the daily performance of the S&P 500 Index -- that means when the S&P declines, the ETF moves higher.
I want you to buy a large position in SH, enough to offset most of your exposure in Chinese stocks. Buy half of the position right away and the other half under $88. I expect to sell it at much higher level as the U.S. stock market continues to deteriorate.
March 12th
ProShares Short S&P 500 (NYSE: SH) shares dropped slightly this week as the S&P 500 rallied strongly on Tuesday. SH dropped below $88 yesterday, giving you a chance to buy the second half of your position. If you don't have a full position yet, take the opportunity to buy SH now under $88, while the U.S. markets are in the midst of a bear market rally.
As I discussed above, I expect the S&P to trade between 670 and 750 until this summer. And I wouldn't be surprised to see it break the 670 level and head lower. That's why I recommend that you hedge your China positions with SH. Buy SH under $88.
March 19th
Question: With regards to your comment "to buy a large position in ProShares Short S&P 500 (NYSE: SH), enough to offset your exposure in Chinese stocks", do you mean if an individual has "X" dollars in Chinese stocks, he should buy "X" dollars in SH?
Answer: As an investor, if you are bearish on U.S. stocks but bullish on China that is exactly what you should do. And even if you are not bearish on U.S. stocks, I still think that you should buy have a position in SH, but in much smaller amount. My recommendation meant that I wanted you to buy more SH than a typical China Strategy position, but not to put the position on all at once. That's why I recommended purchasing your first half at current levels, and the second half below $88.
After recommending SH, though, the bounce in U.S. stocks this past week was more powerful than I had expected. Because of this, I recommend placing a stop loss on your SH holding. I normally don't give out stop loss levels in China Strategy, but because of the trading nature of index hedging, I am today. Place a stop loss to sell half of you SH position if it closes below $73.50.
March 23rd
We've seen the mindset of U.S. government leaders change sharply in the past three weeks. Three weeks ago, Washington's focus was on nationalizing banks, which would have been disastrous for the U.S. economy. Today, the focus is on encouraging private sector investments, which was the right thing to do all along. So, at this point in time, I don't think that its prudent to be hedging our portfolios so aggressively with the markets showing strength right now. I expect the S&P 500 to rally back up to the 900 level by summer, and then likely pullback again in the fall. That's why I'm recommending that you lift half of your portfolio hedge in ProShares Short S&P 500 (SH). I recommend that you sell half of your position in SH, and sell the other half if it closes below $73.50.


Robert Hsu and EFU

February 11th 2009
Europe in Deep Recession
Similar to the situation in Japan, Europe's economic problems are rooted in its shrinking workforce, which is due to its structural demographic problems. There are high numbers of elderly people in the region, and the birth rates in Western European countries are very low. Because of this, there are not enough people entering the workforce to make up for the amount of people retiring. This has put a drag on the region's economic growth, and I look for this trend to continue.
Here's why: Europe is sliding into its worst recession since World War II. Europe's service and manufacturing industries contracted for eight months straight, and confidence in the economic outlook fell to a record low. These contractions have resulted in a low-ball official 7.8% unemployment rate, which could jump to double digits this year.
In addition, Germany -- Europe's largest economy -- may have contracted as much as 2% in the fourth quarter of last year, which would be the biggest quarterly contraction since 1987. Plus, the euro may shrink over 2% this year.
Despite all of these negative developments in Europe's economy, the European Central Bank (ECB) has been very reluctant to cut interest rates. Right now, the interest rate is steady at 2%, and the ECB has shown no indications that it will cut rates any time soon. Unfortunately, its wait-and-see approach is not acting fast enough to protect the economy. As a result of this, I believe Europe's economy will not recover until after the U.S. does, giving us enough reason to invest in an inverse ETF that's shorting the region.
New Buy: ProShares UltraShort MSCI EAFE
So this week, I recommend shorting European stocks by buying an ETF -- ProShares UltraShort MSCI EAFE (NYSE:
EFU). EFU allows us to short stock indexes by buying regular stock shares. It is also easier to trade, as it eliminates a lot of the risk involved in typical short selling.
EFU shorts the benchmark of the MSCI EAFE (Europe, Australasia, Japan) Index, which represents the developed markets outside of North America. The MSCI EAFE Index consists of 21 developed market country indexes, including the United Kingdom (20%), France (11%), Germany (9%) and Switzerland (8%). And in all, European companies make up two-thirds of the index.
EFU tracks daily investment results that correspond to twice the inverse of the daily performance of the MSCI EAFE Index. So this means that EFU should gain about twice as much, on a percentage basis, as any daily decrease in the MSCI EAFE Index. So if, for example, we use 5% of our allocation to EFU, our net equity exposure would go down by 10% without a lot of turnover.
Therefore, I want you to buy EFU under $104. I expect it to hit $120, giving us at least a 15% return in this trade.
March 11th 2009
ProShares UltraShort MSCI EAFE (NYSE: EFU) shares dropped in trading yesterday as European stocks advanced, pushing the Dow Jones Stoxx 600 index to its biggest gain in three months. This was the bounce that I have been expecting, and it may last a few days. But, as you know, I'm still expecting the European economy to struggle this year, and EFU is one of the best ways to take advantage of this nation's weakness. So I recommend that you take advantage of the drop in share price and buy EFU under $135.
March 23rd 2009

Sell ProShares UltraShort MSCI EAFE (NYSE: EFU)
If you recall from mid-February when the recent U.S. stimulus plan was proposed, many investors were on edge. But not just about if the stimulus would work -- also about the vagueness of Treasury Secretary Timothy Geithner's explanation of a planned rescue package. Geithner said that more details would come in the following weeks, but that was no comfort to already anxious investors.
So after weeks of indecisive posturing, Geithner finally unveiled the Treasury Department's plan today. And fortunately, the plan is set to help banks unload troubled assets and help unfreeze credit markets.
I have told you before that the best way to resolve the bad debt crisis is to let the government create incentives for private sector investors to buy toxic assets from financial institutions. I have said that if the Treasury is willing to guarantee against potential downside risk and/or allow tax incentives for investors, private equity funds, and hedge funds that other investors would step up and buy some of this debt. I think this approach is superior to the Treasury buying these assets directly or nationalizing the banks, mostly because the U.S. government is simply not in the business of running banks or managing bond funds. And fortunately, Geithner agrees.
According to the plan, the Treasury would lend $75 billion to $100 billion to provide leverage and guarantees for private investors. The FDIC will insure most of the deal. It will leverage private funds at a six-to-one debt-to-equity ratio, while the Treasury Department will finance half of the remaining balance. Therefore, private investors will only have to put up about 7% of the deal in upfront cash. These factors will likely entice some investors to participate. And I think if the Treasury can offer tax benefits that the deal would be even more attractive.
Even though this plan came a little late, it is the kind of leadership and action the banking system needs from the Treasury. Money is not enough to fix every financial problem, but this plan shows that the Treasury is willing to do whatever is necessary to take out toxic assets.
And the Treasury's plan makes me even more confident that we are seeing the beginning of a bottoming process in financial stocks. I think that this plan, when combined with the Fed's quantitative easing, the FASB's willingness to modify mark-to-market accounting and the SEC's consideration to bring back the "uptick rule" on shorting, may finally break the deadly downward spiral in financial assets that started last October.
Today's action is very bullish for stock investors everywhere. The resurgence of liquidity in the U.S. system will make it easier for debtors everywhere to refinance their loans, and prevent a global economic meltdown. In addition, this will lift global stocks everywhere and cause the market to move higher. Without U.S. financial stocks dragging on the global market, Asian stocks led by Chinese shares can finally move up. And in Europe, these plans will improve global liquidity, since much of the toxic assets held by European banks are U.S. debt..
I look for the European economy to improve due to this increased liquidity. While this is good news for the European economy, it is negative news for our holding in ProShares UltraShort MSCI EAFE (NYSE:
EFU). We originally bought EFU to profit from the dire economic scene in Europe, But since this will be seeing brighter days, I recommend that we get out of this investment. So let's cut our loss and sell our position in EFU.

Louis Navellier and SOHU - Again...

... and again... and again.

Global Growth

April 21st 2008
Company: Sohu.com Inc. (SOHU)
Country: China
Industry: Internet Software/Services
Buy Below: $63.37
China’s Sohu.com Inc. (SOHU) operates China’s leading Web portal and offers communication tools such as e-mail, instant messaging and 30 content channels covering news, sports, business and other topics. The company also operates Web sites devoted to alumni communities, gaming and real estate. Sohu Entertainment offers search services through Sogou, which is translated “search dog.” Sohu’s Chairman and CEO Charles Zhang founded the company in 1996 as Internet Technologies China, changing its name to Sohu in 1999. Zhang owns 25% of the stock.
A Goldman Sachs analyst just raised first quarter estimates for Sohu, citing the strength of its online game “Tian Long Ba Bu.” In a note to clients, Goldman analyst Leah Hao said, “We believe the high-margin game revenue will also likely drive earnings-per-share upside.” Hao raised her first quarter game revenue estimate by $4 million, increasing her total revenue estimate for the quarter to $72.8 million. She also raised her first-quarter earnings estimate to 42 cents per share, up from 34 cents. The company will announce its first quarter earnings on April 28.

March 23rd 2009
Sohu.com was our oldest Buy List stock, a holdover from the meltdown of last fall that I was hoping could struggle back up to a decent profit. But with a poorly-planned IPO, this company really shot itself in the foot last week. Since Sohu would be spinning off it's highly profitable online gaming business, there's no point in owning this stock anymore since I don't expect it to do well without this core profit source. I have to admit I was baffled and a bit angry to see such poor leadership in this company. The stock was consistently near the top of our Buy List, but this ill-advised move has hurt share prices and makes me seriously question if company executives know what they're doing. Aside from the market's hostile environment to IPOs in general, to cut out the most profitable part of Sohu.com right now is a real bonehead move.
Sell price: $40.13
Somewhere in between
Buy below $92

Return
-30% for Mr. Navellier
-56% for those who followed him buying at the beginning of June 2008
Quantum Growth
May 5th 2008
Sohu.com (SOHU) operates China's leading Web portal and offers communication tools such as e-mail and instant messaging, as well as more than 30 content channels covering news, sports, business and other topics. The company also operates Web sites devoted to alumni communities, gaming and real estate. Additionally, the company provides Internet access through its Sohu Entertainment ISP and search services through Sogou, which means "search dog." Sohu's Chairman and CEO Charles Zhang founded the company in 1996 as Internet Technologies China. Zhang launched Sohu.com in 1998 and changed its name the next year. CEO Zhang owns 25% of the company's stock.
On Tuesday, Sohu announced that its first-quarter earnings rose 358.3% to 55 cents per share from 12 cents per share last year. Sales surged 156% to $84.8 million. Sohu said its sales were strong despite a quarter that included the Chinese New Year, which is usually a slow time for Chinese business and might have been aided by the country's worst snowstorms in decade.
China's Xinhua News Agency recently announced that China's population of Internet users rose to 221 million in February and is now vying with the U.S. as the world's largest Internet market. I think the company will also benefit from Olympic-related advertising. Sohu is a good buy.
Buy price: $76.00
Buy below $84.45
March 23rd 2009
Sohu.com (SOHU) is our second sell this week. The company’s share price pulled back after it announced the spin-off of its gaming division, ChangYou.com. This was a very ill-advised move that is very frustrating and makes me wonder what company executives are thinking. Most of Sohu’s non-advertising income comes from its online games business, and that means a ChangYou spin-off will affect Sohu’s bottom line. Some of the company’s officials have tried to do damage control, saying Sohu.com’s numbers won’t take a hit since the Internet provider will retain a 71% ownership stake in the new company. But this is down from the 84% Sohu.com previously held, so I’m not sure these guys know how to do math properly. This gaming business was the foundation of my confidence in this company—and why it was a regular member of our Top 5 list in recent weeks—so without it, there’s no point in holding on to this stock anymore.
Sell price: $40.13
Somewhere in between

Buy below $92
Return
-47%
for Mr. Navellier
-56% for those who followed him buying at the beginning of June 2008

This guy is really incredible!

Louis Navellier is down 27% with SOHU and he says "Sell SOHU Into Strength".

Sell SOHU Into Strength Today

A little bit of certainty goes a long way on Wall Street. Stocks exploded higher in early morning trading today after the Obama administration presented the details of the latest step in its financial rescue package.

The Dow closed up 497 points, but the real winners of the day were our Emerging Growth stocks. Baytex Energy Trust (BTE) and Whiting Petroleum (WLL) continue to lead the pack after another breakout performance, posting tremendous gains of 26.22% and 26.24%, respectively, in the last week alone. This is proof-positive of the tremendous gains our Buy List delivers—and that we truly do own the very best small-cap stocks on Wall Street!
[Just to be precise, BTE is currently gaining 19.12% and WLL, even with its 26% gain, is still DOWN 68.27%]

But I’m not content to rest on our laurels—we need to continue to refine our strategy to stay on top of the market. To that end, I have an important trade today I want you to make RIGHT NOW to take advantage of this rally. The next Emerging Growth issue is this Friday, but I don’t want you to wait to make this sell.

Sohu.com (SOHU) has been trending down in the past few days since it announced the spin-off of its gaming division last Wednesday. This is infuriating to me because the gaming segment of Sohu is why we bought this stock in the first place! In our most recent update, I said that I would hold off on making any changes to our current position in this stock until I’ve had more time to pore over the numbers. And now that I’ve looked at the facts, I’m convinced that selling SOHU immediately is the best course of action. Please sell your shares of Sohu.com tomorrow morning when the market opens to get the best exit price.
Where the hell do you see SOHU's strength?

Monday, March 23, 2009

Louis Navellier and NSC

October 2008

This month, I want you to make four purchases: General Mills (GIS), Norfolk Southern (NSC), Northern Trust (NTRS) and Walmart (WMT). These companies will add breadth to our portfolio—in addition to positioning us to profit!

Norfolk Southern (NSC) transports freight over a network consisting of more than 21,000 route miles in 22 states in the eastern U.S. and in Ontario, Canada. This rail system is made up of more than 16,000 route miles owned by Norfolk Southern and about 5,000 route miles of track rights, which allow the company to use tracks owned by other railroads.
That’s enough track to travel from New York City to Melbourne, Australia—twice! As more companies turn to railways as a fuel-efficient way to transport their products, demand for freight trains is soaring.
That’s why we’re adding NSC to our other transportation picks, CSX Corp. (CSX) and Union Pacific (UNP). Norfolk Southern’s latest quarterly earnings were 12.6% higher than analysts’ consensus estimates thanks to rising rates and increased demand, and this trend is sure to continue into 2009. This Conservative stock is a great buy below $73, currently trading at barely 13 times forecasted earnings!

Buy Price: $67.97
Buy Below: $93
Buy Below: $73 [yes, there are both $73 and $93 in the same issue...]



November 2008

This months Top Stock #3
Norfolk Southern (NSC), another rail carrier, also makes the Top 5 for the same reasons as CSX. According to the Association of American Railroads, metal shipments in the third quarter increased by 16.2%, and coal carloads rose by 4.1%. While its true that overall carloads for the quarter were down about 1%, drastic drops in diesel prices are helping to boost NSC’s bottom line. Fuel prices dropped more than 20 cents a gallon last week alone.

Buy below $60



December 2008

This months Top Stock #3
Norfolk Southern (NSC) transports freight over a network consisting of more than 21,000 route miles in 22 states in the eastern U.S. and in Ontario, Canada. The company posted an earnings surprise of more than 13% for the third quarter even as economic hardships cut into consumer spending and U.S. exports. As the economy recovers, NSC will see its profits surge due to even more business.

Buy below $54



January 2009

Buy below $48



February 2009

Buy below $39



March 2009

You may be wondering why we are selling these two railroad stocks but not Norfolk Southern (NSC). Well, I still would like to keep one rail company in our portfolio because I expect this sector to do well across 2009. What Saudi Arabia is to oil, the U.S. is to corn and coal and I expect demand for these exports to soar this year as the dollar weakens.
That logically means more rail traffic from America’s interior to its ports. Since the fundamentals of CSX and UNP are much weaker, we’ll trim those two and hold on to Norfolk Southern to take advantage of this trend.

Buy below $36



April 2009

We sold our other railroad stocks last week, but I was holding on to NSC in anticipation of a weaker dollar and an increase in exports.
Unfortunately, the dollar has remained stubbornly strong and we can’t afford to wait now that the stock has weakened to a C. Sell this stock and move into a company that will do better in the near term like our new buy.

Sell price around $31.04





Performance: -54%
S&P500 in the same period: -40%

Saturday, March 21, 2009

Louis Navellier and APA

May 2008

Get ready because I have some very exciting buys for you this month as well. Read on to learn about Apache Corp. (APA), Fluor Corp. (FLR), Intuitive Surgical (ISRG), Mechel (MTL) and last by not least Syngenta (SYT).

[click them
all and check how well they performed since April/May 2008]

Apache Corporation (APA) is an oil and gas exploration and production company with onshore and offshore operations in North America, Argentina, Australia, Britain and Egypt. The company has estimated proven reserves of 2.4 billion barrels of oil equivalent, located primarily in five North American regions, including the Gulf of Mexico, the Gulf Coast of Texas and Louisiana, the Permian Basin in West Texas, the Anadarko Basin in Oklahoma and Canada’s Western Sedimentary Basin.
The company recently reported success with three test wells drilled in a remote area of British Columbia that some experts say could become North America’s next big natural-gas field. Apache also boosted its estimate on the area’s potential reserve worth saying that as much as 16 trillion cubic feet of gas could be accessible from its land. This is excellent news for Apache’s future strength.

Risk: conservative
Buy price: $142.51
Buy below $156



June 2008

Buy below $157



July 2008

Buy below $148



August 2008

Buy below $134



September 2008

Ahead of schedule, Apache Energy (APA) resumed gas production at its Varanus Island facility off Western Australia.
An initial gas output rate of 110 million cubic feet per day started flowing August 1, two weeks earlier than originally planned. An explosion in June created fuel shortages throughout Australia.
In other news, Apache had not received any compensation claims from customers whose service was interrupted by the disaster. This is great news, showing that Apache has bounced back quickly from this accident.

Buy below $119



October 2008

APA moved from Conservative to Moderately Aggressive

Buy below $125



November 2008

APA moved back to Conservative from Moderately Aggressive

Buy below $91



December 2008

Speaking of coal and energy policy, there is no doubt that natural gas is expected to be a big winner under President-elect Barack Obama because it is the cleanest burning fossil fuel. Natural gas will become more dominant in electricity generation under the new stricter emission controls. This is sure to boost gasrelated energy stocks like our new buy Southwestern Energy (SWN) as well as existing Buy List picks Apache (APA), Devon Energy (DVN), and EnCana (ECA). And don’t forget that in the near-term, natural gas demand will peak as a cold winter results in greater need for energy to heat homes in America and Europe.

Buy below $83 (already down 40%)



January 2009

Conservative to Moderately Aggressive again

Buy below $80



February 2009

Buy below $78



March 2009

Back again to Conservative

Buy below $66



April 2009

This month the stocks that I recommend selling are Apache (APA) and Norfolk Southern (NSC). As I mentioned in our recent Weekly Update, Apache has weakened fundamentally to a D after a bad earnings report and should be sold immediately.

Price around $62.23



Performance: -56%
S&P500 in the same time: -45%

Update on InvestorCrap portfolio

New stops for FLS, RECN and WDC.

  • FLS: stop at $45.97 (was $44.23)
  • RECN: stop at $13.26 (was $12.86)
  • WDC: stop at $13.94 (was $13.72)

Thursday, March 19, 2009

My portfolio

Stocks bought between March 11th and March 18th

ADBE (Buy price $18.70 - Stop loss at $15.97)
CSKI (Buy price $13.28 - Stop loss at $10.02)
FLR (Buy price $37.99 - Stop loss at $30.45)
FLS (Buy price $52.57 - Stop loss at $44.50)
IPHS (Buy price $9.47 - Stop loss at $7.58)
NE (Buy price $24.39 - Stop loss at $22.45)
RECN (Buy price $14.04 - Stop loss at $12.86)
TRLG (Buy price $10.53 - Stop loss at $7.82)
WDC (Buy price $16.20 - Stop loss at $13.72)

Ready to buy MT?

Robert Hsu just sold MT. It means MT should be at a historic low level.
Mr. Hsu was able to lose 33% on this trade, all in less than two months.
Here is the story:
January 28th 2009
New Buy: ArcelorMittal
As you already know, a big support in China's economic turnaround this year is the country's $586 billion stimulus package. The plan will increase China's infrastructure spending, and boost its demand for the materials for construction. That means that steel companies will benefit from the government's aggressive spending in rail transportation and public construction. And considering that the U.S. is about to implement a stimulus package that will boost infrastructure, global demand for steel will increase dramatically.
This is a great investment opportunity for us, and that's why I recommend we purchase shares of ArcelorMittal (NYSE:
MT). Founded by Indian tycoon Lakshmi Mittal, MT is the largest and the most integrated steel company in the world. It has business in 20 countries across Europe, Asia and the Americas, and it has benefited from a healthy global demand for steel in both developed and emerging countries.
MT produces 116 million tons of steel a year, which accounts for around 10% of world steel output. The company ships 19% of that steel to Asia and Africa, 35% to the Americas, and 46% to Europe. And with a growing presence in Asia, ArcelorMittal has a controlling stake in an integrated steel mill in China.
A key element of the company's strategy is to operate as a vertically integrated business. The company is the largest steelmaker by volume, and it offers the broadest range of steel grades, advanced products, steel solutions and technologies. ArcelorMittal has many different customers, including those in the automotive, appliance, engineering, construction and machinery industries. And ArcelorMittal's booming business has created its strong financial position and cash flow generation. In the third quarter of 2008, sales rose 38% to $35.2 billion, while net income increased 29% to $3.8 billion.

Steel is Hitting a Bottom
You may be hesitant about investing in a steel company considering that steel prices have dropped along with most commodities. Steel producers worldwide have idled capacity and cut workers to reduce costs, as steel demand from automakers and builders plunged. Though steel prices have collapsed, recent steelmakers' earnings announcements signaled that they were still doing pretty well. That's because raw material costs have fallen and steel inventories will need to be replenished this year. And while some pessimists are concerned about oversupply, I think steel demand from countries' stimulus packages will prevent this from happening. This is why I think the fourth quarter of 2008 could have been a bottom for steel makers, and I expect steel prices to rebound in March or April.
In my view, ArcelorMittal is the best play on a recovery in the global steel industry. With one of the most flexible business models and a strong global presence, the company should be able to generate significant profits even in an economic downturn.
In the past eight months, MT's stock plunged 75% from its record high to today's price around $25. Trading at a trailing P/E ratio of only 2.4 and with a 6% dividend yield, MT is significantly undervalued. Buy MT under $25. I'm targeting $35 in the next six to eight months, which would give us a nice 40% gain.
February 4th
ArcelorMittal (NYSE: MT) is shutting down its Lackawana plant in an effort to cut costs in a slowing environment. In addition, MT said that it plans to cut liquid steel output at its Kazakh plant to 3.2 million tons this year from 3.4 million tons in 2008. MT said that the slash in production is due to declining orders for the steel. This production reduction is another example of cost cutting, which is a smart move in the current economic environment. Buy MT only when it is under $25.
February 11th
ArcelorMittal (NYSE: MT) reported its fourth-quarter earnings today. While earnings fell 42% to $2.81 billion, this figure is still above the $2.29 billion expected by analysts. In addition, steel shipments fell 39% after MT slashed output at its mills in response to weakening world demand. I continue to think global infrastructure stimulus packages will help demand for steel. Buy MT only when it is under $25.
February 18th
ArcelorMittal (NYSE: MT) reported better-than-expected fourth-quarter earnings last week. Although earnings fell 42% to $2.81 billion in the fourth quarter, this was above the $2.29 billion estimate by analysts. In addition, MT's sales lost 21% to $22.1 billion. And the company lowered its dividend to 75 cents a share.
MT's net debt fell $6 billion during the quarter to $26.5 billion, and the company said it's on track to cut its debt by $10 billion by the end of 2009. MT also added that its capital spending for this year will be $3 billion, which is below the $4.5 billion previously forecast.
In terms of MT's production, it said that it will continue its output reductions until inventories are completed. I expect MT's business to turn around as global steel inventory gets depleted as a result of global stimulus packages. Buy MT under $25.
February 25th
ArcelorMittal (NYSE: MT) announced this week that it will not be acquiring or merging with companies any time soon. MT's global business was created mostly through these measures, but the global economic slowdown has caused the company to temporarily halt these actions. The stock fell on the news this morning, but has gained a bit since the announcement. Overall, I don't think this decision will make a big difference for the company right now. Buy MT under $25.

March 4th
ArcelorMittal (NYSE: MT) shares traded lower since last week, but they have moved up in the last two days. It is helping that ArcelorMittal South Africa Ltd, a unit of ArcelorMittal, is keeping prices across all steel products steady after cutting production by 35% during the first quarter. In fact, the South African company plans to operate at about 65% capacity during the first quarter of this year.
Overall, MT's stock is trading at a steep discount, due to the global financial crisis. But I recommend holding our MT shares because Europe and the U.S., the company's main markets, are still in a slump even though steel demand in China will likely be strong. Looking forward, I expect the Chinese stimulus plan to support global steel prices. But for now, hold MT.
March 11th
ArcelorMittal (NYSE: MT) announced this week that it is shutting down two of its U.S. steel mills as the recession continues to weigh on steel demand. This is part of the company's plans to cut 45% of its production capacity until steel inventories diminish and steel demand increases. The plants to be shut down are in Georgetown, South Carolina, and Cleveland, Ohio, and the company will be laying off employees. However, MT says that it plans to rehire those employees when the steel market improves.
I don't think that the production cuts will impact MT. Steel continues to be a good way to benefit from global stimulus packages. But aside from China, other stimulus packages have been disappointing in the relative absence of infrastructure projects. Hold MT.
March 18th
Sell ArcelorMittal, Suntech Power & ProShares UltraShort Euro
Because of the recent bounce in global stock markets, I am recommending that we minimize our losses on two of our current trades by selling them today, as well as sell one of our currency trades. Let's take a look at all three of these recommendations, and why I think we should sell them now.
If you recall, in late January, I recommended investing in ArcelorMittal (NYSE:
MT). I thought it would be a great way to benefit from the boost in infrastructure spending in China and the U.S., fueled by each country's respective economic stimulus packages. I also expected the global steel industry to recover better than it has. But with the economy continuing to spiral downward, this has not happened as soon as I expected.
In fact, during the first quarter, steel demand has remained very weak, and as a result, the world's largest steelmakers are slashing production. Steel prices have plunged by more than half from a record in July as sales of automobiles, appliances and homes slowed. And there are few signs that this weakness will abate, as the recent stimulus plan will not show any effect on the steel market until the end of the year.
Because of this, MT's shares tumbled. In addition, the company took a hit after the Financial Times said there was speculation that ArcelorMittal might need to raise money from secondary offering. Although the steelmaker denied the report and reiterated it doesn't need to raise capital, the stock still tumbled. Now, the stock has broken its key support level, and considering these factors, I think shares might decline even more. Now is a good time to sell because the stock market has rallied 13% off the bottom. So, I want you to sell MT.
We will see in the next week how good it was to sell MT at this time at $17.68...

Friday, March 13, 2009

What I bought

For your information, here is whet I bought on March 11th:
  • RECN (initial stop loss at $12.86)
  • FLS (initial stop loss at $44.50)
  • FLR (initial stop loss at $30.45)
  • WDC (initial stop loss at $12.69)
  • ADBE (initial stop loss at $15.97)

Thursday, March 12, 2009

Thank You Robert Hsu















Louis Navellier and IPCR

In my archive I found a couple of trades on IPCR for Louis navellier's $5.000/year Global Growth.



The first trade was initiated on August 4th 2008 with a Buy advice:



Bermuda's IPC Holdings (IPCR) sells property catastrophe reinsurance through its principal operating subsidiary, IPCRe Limited. Reinsurance pays only after an insurance company's losses on natural or man-made disasters exceed a specific amount. IPC Holdings also provides short-tail property reinsurance. Headquartered in tax-friendly Bermuda, the firm insures large insurance companies worldwide, even though most of its clients are based in the U.S. To better understand this company, just watch The Weather Channel and study the hurricane outlook. Due to fewer natural disasters lately, IPC Holdings has been rallying.



Buy price was $31.91 and Buy below was $33.20


August 11th

Buy below $34.00


August 18th

Buy below $33.84


August 25th

Buy below $32.70



September 2nd

Buy below $33.76


September 8th

Buy below $33.79


September 15th

Buy below $32.15


September 22nd

Buy below $31.92



September 29th

Our first earnings announcements will be coming out during the week of October 20 to 24, beginning with Icon (ICLR) on October 21, then Alcon (ACL) and Perdigao (PDA) on October 23, followed by IPC Holdings (IPCR) on October 24. I will bring you the full list next week. Earnings announcement season should give our stocks a welcome boost, as the market will return to watching fundamentals, instead of being obsessed with the latest news on the credit crisis.

Buy below $30.09



October 6th

Bermuda's IPC Holdings Ltd. (IPCR) will report earnings on Friday, October.

Buy below $28.10


October 13th

Bermuda's IPC Holdings (IPCR) estimated that its insurance costs from hurricanes Gustav and Ike would subtract about $90 million from its third-quarter net income. The stock declined on this news plus the company's disclosure of a modest $11.2 in direct holdings of fixed-maturity securities issued by Lehman Brothers. In addition, IPC held securities issued by Morgan Stanley, The Goldman Sachs Group, Inc., and Wachovia Corp. and their subsidiaries — specifically, $28.5 million, $33.0 million and $12.0 million (par values), respectively. The company has no holdings in AIG or Washington Mutual and only a small amount of indirect exposure to preferred or common shares of Fannie Mae and Freddie Mac. This exposure is via Vanguard mutual funds.

Bermuda's IPC Holdings (IPCR) will report earnings Friday, October 24.

Buy below $24.55


October 20th

Among our provisional (“sell above”) stocks, Bermuda’s IPC Holdings (IPCR) will report its earnings on Friday, October 24 at 8:30 a.m. EDT, about an hour before the market opens. So watch to see if we get a bounce at the end of the week—and if we do, sell into strength!

Sell Above $22.10 (Louis claims selling at $22 what he payed $31 means selling into strength)


October 27th


On Friday, October 24, IPC Holdings (IPCR)surpassed its 'sell above' target and is no longer on the Buy List. (it was actually on the Sell List)

Last week, we sold Bermuda's IPC Holdings (IPCR) when it hit its "Sell Above" price on Friday. This week, I anticipate we'll have a handful of sells on up-ticks–so make sure you take a look at the revised "Sell Watch List" to get to know the latest price targets.


This first trade generated a loss of around 30% for Mr. Navellier and his subscribers.

But one month later he decided to buy IPCR again, at a higher price compared to previous sell... $25.63, corresponding to a 16% missed profit.







November 24th 2008

Bermuda's IPC Holdings Ltd. (IPCR) sells property catastrophe reinsurance on an excess-of-loss basis for primary insurers, sold through its principal operating subsidiary, IPCRe Limited. Reinsurance pays only after an insurance company's losses on natural or man-made disasters exceed a specific amount. IPC Holdings also provides short-tail property reinsurance. The company insures large insurance companies worldwide, but most of its clients are based in the U.S. IPC Holding has estimated that Hurricanes Ike and Gustav cost it about $90 million.

Buy below $26.65

December 1st

Buy below $25.98


December 8th

Our other Bermuda insurance stocks, Assured Guaranty (AGO) and IPC Holdings (IPCR), have turned in healthy gains in a short period, and I'm confident Montpelier will follow suit.

Buy below $30.30


December 15th

Buy below $29.46


December 22nd

Buy below $29.25


December 29th

Our big Bermuda focus paid off, however, with our seven stocks headquartered there posting an average gain of almost 2% since the market's close last Monday.

Buy below $29.54


January 5th

Buy below $31.04


January 12th

Buy below $29.81


January 20th

Buy below $28.51


January 26th

Buy below $28.11


February 2nd

Buy below $26.98


February 9th

Buy below $27.63


February 17th

This week, we'll get earnings reports from Companhia Brasieira de Distribuicao Grupo (CBD), IPC Holdings Ltd (IPCR) and Montpelier Re Holdings (MRH) and Copa Holdings (CPA).

Buy below $27.62


February 23rd

Bermuda's IPC Holdings (IPCR) bucked the tide with a small gain last week, after the company reported positive fourth quarter results, well above consensus estimates. Earnings were down, due to exceptional hurricane settlements, but earnings were down less than feared. The company's operating earnings excluding one-time items were $0.84 per share last quarter, down from $2.09 a share year earlier. Revenue fell 15% to $120.1 million, but analysts had been expecting much lower earnings (58 cents per share) on just $105.1 million in revenue, for a 45% earnings surprise and 14% revenue surprise. Also, net premiums written nearly tripled to $39.5 million.

Buy below $27.37


March 2nd

Buy below $25.73


March 9th


This week, I recommend that you sell Bermuda's IPC Holdings (IPCR) and Montpelier Re Holdings (MRH). MRH has been very week recently since a poor earnings report to end February.
Bermuda has been a big part of our Buy List, but in anticipation of a weakening dollar we need to start trimming weaker stocks in this region. Since Bermuda's currency is pegged to the dollar, companies headquartered there are often linked to the fate of the greenback. Also, I want to make sure we stay diversified in this difficult market to make sure we can resist future declines. Since we have a number of insurance plays in the financial sector, we'll cut these two loose and replace them with companies in other industries to reduce our risk.


Price was around $20.89 for another 18% loss.

You can remark that every single buy below price in these seven months was higher than the actual sell price.

Tuesday, March 10, 2009

Louis Navellier ans SYKE


Louis Navellier traded SYKE already in September 2008. He bought it on September 2nd at $20.58 and sold it on September 22nd at $20.63.

On November 3rd 2008, with SYKE closing at $16.48, he was writing to his Quantum Growth subscribers:

Sykes Enterprises (SYKE) is in the call center business. The company operates about 40 technical help and customer support centers in Africa, the Americas, Asia and Europe that use phone, e-mail, and chat to serve those in need of help. It specializes in customer service and inbound technical support and also provides large corporations with technical staffing and consulting relating to customer relationship management. In Europe, Sykes Enterprises offers additional fulfillment services, such as multilingual order and payment processing and product returns handling.
Sykes recently raised its full-year outlook to $1.39 to $1.44 per share on sales of $825 million to $830 million. Previously, the company estimated earnings of $1.24 to $1.33 per share on sales of $815 million to $830 million. Sykes Enterprises is a good buy.


The buy below price was $17.76

November 10th 2008

Sykes Enterprises (SYKE) was one of our new buys from last week. Right after last week’s issue went out, Sykes reported very strong earnings. Third-quarter profits jumped 56.7% to 47 cents a share which was more than 70% above Wall Street’s expectations. On Tuesday, the stock soared by more than 16%, and way above my buy-below price. Later, however, the shares pulled back below my buy-below price. If you didn’t have a chance to buy Sykes last week, I’ve updated the Buy Below price. Also, don’t be worried about the shares pulling back further. I was pleased to see the company say to expect fourth-quarter earnings of 30 to 32 cents per share. Sykes continues to be a good buy.

Buy below $18.19.


November 17th 2008

Buy below $17.47


November 24th 2008

Buy below $19.03


December 1st 2008

Buy below $18.24


December 8th 2008

Buy below $18.67


December 15th 2008

Buy below $17.46


December 22nd 2008

Buy below $19.48


December 29th 2008

Buy below $20.01


January 5th 2009

Buy below $21.00 (did anybody buy here?)


January 12th 2009

Buy below $19.70


January 20th 2009

Buy below $17.86


January 26th 2009

Buy below $17.85


February 2nd 2009

Buy below $17.86


February 9th 2009

Buy below $17.57


February 17th 2009

Top Stock #4. Sykes Enterprises Inc. (SYKE) is in the call center business. The company operates about 40 technical help and customer support centers in Africa, the Americas, Asia and Europe that use phone, e-mail and chat to serve those in need of help. It specializes in customer service and inbound technical support, and also provides large corporations with technical staffing and consulting relating to customer relationship management. In Europe, the Sykes Enterprises offers additional fulfillment services such as multilingual order and payment processing and product returns handling.
In its latest quarter, the company’s earnings rose 168.8% to $17.7 million or 43 cents per share compared with $6.3 million or 16 cents per share in the same quarter a year ago. During the same period, sales rose 23.4% to $207.6 million compared with $168.3 million. The analyst community expected earnings of 30 cents per share, so the company posted a 43.3% earnings surprise! Looking forward, Sykes Enterprises raised its full-year outlook $1.39 to $1.44 per share on sales of $825 million to $830 million. The stock consolidated last week but remains a good buy.


Buy below $16.18


February 23rd 2009

Buy below $15.91


March 2nd 2009

Top Stock #5. Sykes Enterprises Inc. (SYKE) is in the call center business. The company operates about 40 technical help and customer support centers throughout Africa, the Americas, Asia and Europe. It specializes in customer service and inbound technical support and also provides large corporations with technical staffing and consulting relating to customer relationship management. Despite last week’s volatility, the stock improved and remains a good buy.

Buy below $16.65


March 9th 2009

This Week’s Sell
Sykes Enterprises Inc. (SYKE) no longer meets my strict Portfolio Grader criteria to qualify as a Quantum stock.


Close price was $13.88.



15% loss for Mr. Navellier and 30% loss for those who bought it below $21 in January.

Saturday, March 7, 2009

14.87% Parabolic Losses in 2009

Mr. John Lansing closed all his positions. It is time to summarize his performance for the first 2 months of 2009.


ESI 02/23/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
ENJPR Buy April 90Put $3.30$6.503.296.97%
UTHR 02/20/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
HSUQL Buy May 60Put $6.00$7.801.830.00%
BIDU 03/04/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
BDQPT Buy April 100Put $1.75$2.300.5531.43%
FFIV 02/20/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
FLKOC Buy March 15Put $0.10$0.150.0550.00%
AZO 02/02/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
AZOOD Buy March 120Put $5.20$0.50-4.7-90.38%
MYGN 01/30/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
GSQOM Buy March 65Put $2.65$0.70-1.95-73.58%
MON 01/27/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
MONON Buy March 70Put $3.40$3.600.25.88%
BIDU 02/24/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
BDQPT Buy April 100Put $3.40$2.05-1.35-39.71%
CF 02/24/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
CFQH Buy May 40Put $3.00$1.45-1.55-51.67%
FFIV 01/21/09 - 03/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
FLKOC Buy March 15Put $0.35$0.10-0.25-71.43%
ESI 02/23/09 - 03/04/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@ENJPR Buy April 90Put $2.50$5.002.5100.00%
APOL 02/12/09 - 03/04/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
OAQQL Buy May 60Put $2.95$5.702.7593.22%
APOL 02/20/09 - 03/04/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
OAQQL Buy March 60Put $2.50$4.802.392.00%
CHTT 01/30/09 - 03/04/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@HQTOL Buy March 60Put $1.90$4.302.4126.32%
CHTT 02/20/09 - 03/03/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
HQTOL Buy March 60Puts $1.50$3.201.7113.33%
STRA 02/12/09 - 03/02/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
DAEPJ Buy April 150Puts $3.50$7.003.5100.00%
MON 02/25/09 - 03/02/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
MONON Buy March 70Puts $1.65$3.101.4587.88%
AZO 02/25/09 - 03/02/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
AZOOD Buy March 120Puts $1.75$2.050.317.14%
BIDU 02/27/09 - 03/02/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
BDQPT Buy April 100Puts $2.20$3.20145.45%
CF 02/25/09 - 03/02/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
CFQH Buy May 40Puts $1.10$1.400.327.27%
GDP 01/15/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@GDPNE Buy Feb 25Put $2.50$0.05-2.45-98.00%
APA 01/15/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@APANN Buy Feb 70Put $4.80$5.500.714.58%
SWN 01/16/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@SWNNE Buy Feb 25Put $1.75$0.02-1.73-98.86%
FRT 01/15/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@FRTNI Buy Feb 45Put $4.50$2.25-2.25-50.00%
SCHN 01/07/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@SQQNG Buy Feb 35Put $2.50$2.10-0.4-16.00%
APOL 01/07/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@OAQNN Buy Feb 70Put $3.50$0.05-3.45-98.57%
FFIV 01/21/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@FLKND Buy Feb 20Put $1.00$0.20-0.8-80.00%
ADM 01/08/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@ADMNE Buy Feb 25Put $1.30$0.05-1.25-96.15%
GG 01/08/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@GGNE Buy Feb 25Put $1.75$0.05-1.7-97.14%
CTRP 02/09/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@QCTBX Buy Feb 22.5Call $0.60$0.05-0.55-91.67%
EOG 01/16/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@EOGNL Buy Feb 60Put $3.70$4.801.129.73%
PFG 02/10/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@PFGBC Buy Feb 15Call $0.60$0.05-0.55-91.67%
ESI 02/12/09 - 02/20/09







Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
@ENJPR Buy April 90Put $2.75$4.001.2545.45%
UYG 02/05/09 - 02/06/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
UUFCD Buy March 4Call $0.45$0.600.1533.33%
SWN 12/23/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
SWNME Buy Jan 25Put $1.80$0.05-1.75-97.22%
APA 12/23/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
APAMN Buy Jan 70Put $4.70$0.05-4.65-98.94%
FSYS 12/19/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
QQMF Buy Jan 30Put $3.00$0.05-2.95-98.33%
EDU 12/18/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
EDUMI Buy Jan 45Put $2.10$0.03-2.07-98.57%
GDP 12/09/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
GDPME Buy Jan 25Put $2.75$0.05-2.7-98.18%
EOG 12/09/08 - 01/16/09
Symbol Action Month Strike Type Entry Price Closed Price G/L $ G/L %
EOGML Buy Jan 60Put $3.75$0.05-3.7-98.67%


Average: -14.87%
Not bad compared to S&P500 24% loss (if Parabolic Options was free...)