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Seeking Alpha Alert: 2:30 PM Shares of RadioShack (RSH +10%) shoot higher with comments out from Deutsche Bank that the retailer is at a "pretty significant" crossroads. After the company's partnership with Target fizzled, it appears to be launching another Hail Mary with a plan to grow its brand in emerging Asian markets.
I don't personally get how it evolves to continue in the US (shrugs), but I could see it working as an emerging markets play. I don't see any of the stores around anymore, and their deal with Target (which I thought was interesting in theory) didn't work. I think I've probably said it before, but Gamestop is the other retail play I think goes away in 3-5 years.
In terms of things that are quite distressed, I like Cosi (COSI) and RiteAid (RAD), but have no plans to invest in either.
I slid down the back side of RIMM last year buying it at $57/ share. So after RIMM bottom at $6 a share recently I still could not bring myself to pile in. I guess my temperament is to let smarter investment managers make these calls. I wish I had the skill set, time and nerve to sucessfully play in the stock sand box. In less than 6 month RIMM has now doubled to $12 and in the last month is flirting with $18 on the news that BB10 will rescue its death spiral. Don Yatchman (YACKX) and other deep value investors find stocks like these and I trust (and pay) Don Yatchman for his services. Looking for other mutual fund that specificly target these plays. At one time I did own UMBIX which became Columbia Value and Restructuring. Owning mutual funds that sell out to bigger investment entity worry me. This is one of the reason I got out of UMBIX and will probably be why I move away from YACKX.
Hoping Radio Shack will be a homerun for you.
Short covering plays a big part in the recent upward jump days with RIMM...keep an eye on this dynamic.
Reply to @bee: See also "Canadian Buffett" Prem Watsa of Fairfax Financial Holdings (FRHLF.pk), who is the largest holder of RIMM and got himself on the board.
Sorry to hear about your experience with RIMM. There are some contrarian mutual funds around that generally target this sort of thing, but none of them seem all that great.
Ha! I started out wanting to short it last November. I think I had just experienced another high-priced purchase at one of its stores, by an ineffective and inattentive staff. I thought, this place simply can't survive much longer. But when I dug into it a bit, I saw AQR Capital Management had purchased 2 millions shares in September. I started thinking about all its stores and that it would likely be take-over target. So, pure speculation, I bought a small chunk on 12/3 at $2.06. It performed well and on 12/20 I doubled-down at $2.367. But to protect my gain, I placed a stop order at $2.17. On 12/27, I was stopped-out in two batches...$2.19 and $2.191.
I did the same with Pandora P. I was not looking to buy it, but when it plunged in December, I quickly bought some up, $8.00 on 12/05. My wife and her friends have Pandora on all the time! P also did well and on 12/20 I doubled-down at $9.058, like I did RSH. Once again, I protected my earlier gain with a stop order at $8.46. Then, on 12/21, I was stopped-out in a single batch at $8.51.
Today, RSH is at $2.64 and P is at $11.54. I consider both events a testament to my shrewd investing skills.
The thing about investing in stocks, especially short-term speculative, and similarly with options, is just how much time and attention it demands, something I think I recall you writing about. If you're gonna play that game, you'd better be, figuratively at least, all in.
Right now I have only one stock in play...BAC. I bought a bit on 01/06/2012 at $6.208. I followed with a fairly large buy for me on 05/22 at $6.91. Recently I doubled-down on 12/21 at $11.215. Yes, I have a stop order in play at $10.34.
Reply to @Charles: Reply to @Charles: "The thing about investing in stocks, especially short-term speculative, and similarly with options, is just how much time and attention it demands, something I think I recall you writing about. If you're gonna play that game, you'd better be, figuratively at least, all in."
VERY nice trade on BAC!
Yeah, my thing is really that I have a lot of respect for people who can sit and day trade speculative positions. I just don't have the mentality for it and I've just become less and less interested in having to having to micro-manage/monitor things and would rather be long-term. I've added a series of duller names where I like the story (Reckitt Benckiser, for example, which I've mentioned before.)
The stocks that I own are long-term plays, although even pulling together/managing a portfolio of those names is difficult. The most volatile holding (Glencore) isn't a real day-to-day concern because I continue to have a long-term view and want to own Glencore's management and unique assets, which include 270k hectares of owned or leased farmland in Australia, Paraguay, Russia, Ukraine and Kazakhstan and elevators and silos with a combined storage capacity of 3.8 million tonnes. In the meantime, Glencore also offers a nice dividend yield. Hasn't done as well as I'd hoped, but it's - I think - a unique play both in terms of assets and management and I'm willing to wait.
I continue to like the Asian conglomerates (Jardine Matheson, Hutchison Whampoa, Swire and First Pacific sort of fits) as broad ways to play Asia (although some have exposure elsewhere.) Swire is one of the world's largest Coca-Cola bottlers, serving parts of the US as well as China, Taiwan and HK; Hutchison owns AS Watson, a retail company with 10,000 stores in 33 markets; Jardine is the majority owner of retail conglomerate Dairy Farm and the Mandarin Oriental Hotels.)
They all own a ton of other assets, as well - Hutchison is one of the world's largest port operators, for example. They're kind of like dynasties - they've been around for ages (Jardine was founded in 1832, Hutchison in 1863, Swire in 1816)
RSH, HNHPF.PK 2:52 AM Six months later (original), RadioShack (RSH) formalizes the terms of its Asia joint-venture with Cybermart (HNHPF.PK). Cybermart will own 51% of the JV, which could see the retailers opening small-format stores in China, Taiwan, Hong Kong and Macau. RSH shares are -68.5% Y/Y, but +43.9% M/M - the start of a new uptrend, or an opportunity to dump shares. [Consumer] Comment! http://seekingalpha.com/currents/all
Comments
In terms of things that are quite distressed, I like Cosi (COSI) and RiteAid (RAD), but have no plans to invest in either.
Did you invest in RS?
Hoping Radio Shack will be a homerun for you.
Short covering plays a big part in the recent upward jump days with RIMM...keep an eye on this dynamic.
Sorry to hear about your experience with RIMM. There are some contrarian mutual funds around that generally target this sort of thing, but none of them seem all that great.
Ha! I started out wanting to short it last November. I think I had just experienced another high-priced purchase at one of its stores, by an ineffective and inattentive staff. I thought, this place simply can't survive much longer. But when I dug into it a bit, I saw AQR Capital Management had purchased 2 millions shares in September. I started thinking about all its stores and that it would likely be take-over target. So, pure speculation, I bought a small chunk on 12/3 at $2.06. It performed well and on 12/20 I doubled-down at $2.367. But to protect my gain, I placed a stop order at $2.17. On 12/27, I was stopped-out in two batches...$2.19 and $2.191.
I did the same with Pandora P. I was not looking to buy it, but when it plunged in December, I quickly bought some up, $8.00 on 12/05. My wife and her friends have Pandora on all the time! P also did well and on 12/20 I doubled-down at $9.058, like I did RSH. Once again, I protected my earlier gain with a stop order at $8.46. Then, on 12/21, I was stopped-out in a single batch at $8.51.
Today, RSH is at $2.64 and P is at $11.54. I consider both events a testament to my shrewd investing skills.
The thing about investing in stocks, especially short-term speculative, and similarly with options, is just how much time and attention it demands, something I think I recall you writing about. If you're gonna play that game, you'd better be, figuratively at least, all in.
Right now I have only one stock in play...BAC. I bought a bit on 01/06/2012 at $6.208. I followed with a fairly large buy for me on 05/22 at $6.91. Recently I doubled-down on 12/21 at $11.215. Yes, I have a stop order in play at $10.34.
Bee, That's exactly how I feel! And why 98% of my portfolio is managed by much smart and dedicated professional fund managers.
My best performance comes when I don't interfere.
VERY nice trade on BAC!
Yeah, my thing is really that I have a lot of respect for people who can sit and day trade speculative positions. I just don't have the mentality for it and I've just become less and less interested in having to having to micro-manage/monitor things and would rather be long-term. I've added a series of duller names where I like the story (Reckitt Benckiser, for example, which I've mentioned before.)
The stocks that I own are long-term plays, although even pulling together/managing a portfolio of those names is difficult. The most volatile holding (Glencore) isn't a real day-to-day concern because I continue to have a long-term view and want to own Glencore's management and unique assets, which include 270k hectares of owned or leased farmland in Australia, Paraguay, Russia, Ukraine and Kazakhstan and elevators and silos with a combined storage capacity of 3.8 million tonnes. In the meantime, Glencore also offers a nice dividend yield. Hasn't done as well as I'd hoped, but it's - I think - a unique play both in terms of assets and management and I'm willing to wait.
I continue to like the Asian conglomerates (Jardine Matheson, Hutchison Whampoa, Swire and First Pacific sort of fits) as broad ways to play Asia (although some have exposure elsewhere.) Swire is one of the world's largest Coca-Cola bottlers, serving parts of the US as well as China, Taiwan and HK; Hutchison owns AS Watson, a retail company with 10,000 stores in 33 markets; Jardine is the majority owner of retail conglomerate Dairy Farm and the Mandarin Oriental Hotels.)
They all own a ton of other assets, as well - Hutchison is one of the world's largest port operators, for example. They're kind of like dynasties - they've been around for ages (Jardine was founded in 1832, Hutchison in 1863, Swire in 1816)
RadioShack RSH up another 12%.
Shares Short (as of Jan 15, 2013)3: 33.99M
Short Ratio (as of Jan 15, 2013)3: 11.30
Short % of Float (as of Jan 15, 2013)3: 34.20%
http://seekingalpha.com/currents/all