Thursday, April 25, 2013

5 $100 Investments

First, Netflix is up 24% two days ago. Booyah. Before I get too happy, even a broke clock is right twice a day.  I didn't expect that when I bought it a few weeks ago.

I'm looking at buying $100 worth each of 5 stocks. My point is that you don't have to have a lot of money to start investing. If $500 is too much, buy $10 worth of 5 stocks.  You can start there and work your way it.

Ideally, I want to get stocks with very low prices so I can buy several shares. Since I already bought Fanny Mae and Freddie Mac at about $.76 each I'll leave those alone, here are some I looked at:

WebMedia Brands (WEBM) - Up 8% today to $1.86/share. They lost $6.4M last quarter, even without a non recurring charge, the loss was bout $900k, the worst quarter last year.  Looking at the headlines, I don't see anything exciting.

Zaap (ZAP)  - this maker of hybrid engines is up 2% today, to $.15/share. Their historical best price was about $1.80, 3 years ago. The headlines look like they're doing things to keep the lights on....

Suntech Power Holdings (STP) - the world's biggest maker of solar inverters, used to trade at $90/share. Now it's $.64. Wow.  They also just defaulted on some convertible notes and are trying to restructure. Any other time I'd say run for the hills, but if they do pull off a miracle, that $100 investment might soar....

LDK Solar (LDK) - another solar supplier, up 3% today.  This company looks like they're having serious financial problems, but are further down the road than Suntech in fixing them. Doesn't mean they can or will be fixed, but they've  been dealing with them longer. It's sold off a few subsidiaries and other interests, but the US's countervailing duties tax of 15% is seriously hurting Chinese solar suppliers.They're also looking at $23M in convertible senior debt they can't pay back right now. Their historic high is about $80/share, which makes today's $1.14 look crazy.

ArQule, Inc (ARQL) - This biotechnology company engaged in the research and development of next-generation, small-molecule cancer therapeutics. Yeah, a mouthful. Up 2% today, to $3.07. Their historical high is about $40. They caught the mother of all stock beatdowns back in October 2012 when they stopped a lung tumor study, losing 54% in one day. Their low was about $2, so they've climbed 50% since then. Yeah, they got my attention. But their 6 month chart looks like a mountain range after the Enterprise skidded across it.

Advanced Micro Devices (AMD) - this long time Intel competitor was once a $50 stock, now it's a $2.69 stock. It and Intel are both feeling the "post PC" heat. Intel's handling it better. They're up 3% today.

Alcatel Lucent (ALU) - This was once an $80 stock, now  it's $1.41.  They just installed a high speed network in Italy, so they're still working. Deutsche Bank recently upgraded them from HOLD to BUY, not that that means anything, other than somebody somewhere with a nice office likes them. Two years ago, it was $7, now it's $1.41. It's been as low as $.98.  They're still in business and can't go anywhere but up.

 Authentidate Holding Corp (ADAT) - Twelve years ago this was a $40 stock. It's now $1.35. They've lost at least $2.5B each of the last 3 quarters. That's with a B. Most articles on them are about their filing financial statements. Very little company info other than here's a new 10k report.

I'll let you know shortly who I go with....

Thursday, April 18, 2013

More evidence that logic does not live anywhere near Wall Street

The last 2 days have been ugly on Wall Street.  Pretty much everybody is down. Don't believe anyone who tells you they know why, they don't. Again, the stock market is like a cruise ship powered by 1,000 people rowing and no one is coordinating their rhythm or direction. Eventually the ship will move in a direction from sheer dumb luck. 

I came across this article, talking about how all the cell phone companies are down.  It said something interesting about Nokia: "...The company’s current share price is around $3.5 even though it has $3.7 per share in cash alone."  That's because probably 80% of the people who are taking actions that are causing the price to change have no idea how much cash Nokia has, nor how to calculate the stock price based on the cash balance alone.  

The point is that people are doing stuff, buying stocks, selling stocks, holding stocks, whatever. And they're doing it not based on what the last quarterly report for Nokia was. Heck, they probably haven't even seen the last quarterly report. Then there are the computer programs, making perhaps millions or billions of decisions a second. Apple's down, sell Nokia. Nokia's up, buy Samsung. Samsung is up, buy Intel. All day, every day. That's why the markets are always all over the place. Don't try to understand it, just roll with it.  Especially when we have days like today, lower prices make great buy opportunities....

Tuesday, April 16, 2013

I missed the boat, but it looks like a long voyage

A few weeks back I jump on a few stocks, Delta (DAL), Facebook (FB), Netflix (NFLX) and Whole Foods  (WFM). So far the results are still mixed to suck, up 5% in Delta, down 1% in Whole Foods, down 7% in Facebook and down 4% in Netflix.  If the last 2 don't start performing soon, they're going bye bye. My concern with Facebook is I still just don't see them as being worth what the market says they are. Yeah, I bought it, but it was more trying to catch the wave from $17-27 than having real faith. I'm getting my just deserts. Netflix I have more faith in right now.Whole Foods is looking more like a very long play. Go Delta.

This morning I jumped on 2 that I got beat down big time on last year: Federal Home Loan Mortgage Corporation (FMCC) and Federal National Mortgage Association. (FNMA)."Fannie Mae" and "Freddie Mac".  I had bought both a few years back at about $1/share. They dropped to $.33 and stayed there after the housing crisis.  I tried to hang on but finally bit the bullet and took my losses.  Here's the thing, if you look at their 7 year chart, Freddie Mac used to sell for $80/share before the crash, Fannie Mae about $90. They're now around $.75. No, that's not a typo. On about March 14th they both shot up to about My perspective is they were backed by the government then, and they still are. If they never hit those levels again, heck, if they only hit $8 and $9/share, that's a hundred fold return. I've been watching them a week or so and they both look like they're holding at the current rate. As a matter of fact, FNMA is up 7% already. Sweet...

I had a McDonald's coffee this morning. It tasted like grilled water. Subway has passed McDonalds as the largest fast food outlet, and McDonalds coffee tastes like grilled water. Seems like somebody is phoning it in....