This week’s review is going to be a bit different as i try to wrap my actions / thoughts around different articles i found useful … this may be a bit longer than my typical posts.
- Favorite SA author, Jeff Miller, pointed me here – I was quite focused last week taking advantage of the over-reactions to news rather than solid fundamentals. Here is a quick list of my actions
- Sold GIS – i finally cut the cord to processed food and packaged cereals … the growth potential here is neither terrible nor great, but the social impact is not something i can support. A good social / financial convergence and decision made.
- Bought TSCO – This was just too cheap and i have a very hard time seeing how AMZN will start selling farm equipment and other essentials for rural survival. Fundamentally, TSCO is solid for 5+ year investment. I was interested around $60, but picked up at $58.5 basis
- Bought more TJX – This is my favorite retail / consumer company. They too fell from the AMZN will conquer the world. Read their quarterly update and pay attention to the inventory numbers. Add that to their customer experience (my wife is a tough tough consumer, but loves TJX)
- Bought more VZ – This was just too cheap. I realize they have a buying splurge that may / may not make complete sense and their debt is high. I see no other players in the 5G space in USA outside of T and VZ. I will be patient, and the dividends are now >5%.
- Bought more DSW – This is in my daughter’s account. 10+ years. Foot locker news drove it even lower and piled on the AMZN killer thesis. ~3.5% dividend, an aggressive corporate strategy, and … how many people still want or need to try on shoes before buying?
- So for the week … my cash position across ETF, REIT and Stock portfolios has dropped from >15% to ~10%. This is my ‘fully invested’ position at this time. I am an often vulture investor, and keeping 10% cash is comfortable right now.
- Which is more important, revenue or income? … my corporate experience tells me … longer term, both need to converge. short term, revenue trumps income (too many dials can be turned to modify income a couple of pennies) … see this: http://fundamentalis.com/?p=6940
- Brazil story has a couple of good nuggets: a) traders dilemna (sell now to remove risk, hold for greater potential returns – i find that i always follow the first fork in the path … take smaller profits and limit risk); b) ETF exaggerations and c) interplay between politics and financial fundamentals https://seekingalpha.com/article/4074319-brazil-crashes-lessons-learned
- This chart is a weekly inclusion from Jeff Miller, but the point to highlight this week is the delta in the 10yr Treasury (while not much change from last month, look at the weekly delta)
Later in the day update
- A bit of history and a bit of expanding our investment targets more globally – http://awealthofcommonsense.com/2017/05/think-global-to-avoid-the-shrinking-u-s-stock-market/
- A view of bond traders as the better gauge of future investment directions – especially w/ interest rates. Not sure i buy this argument fully, but i do think the bond folks merit equal attention to the stock pickers – https://www.blackrockblog.com/2017/05/19/bond-markets-reflation
- Just ‘follow the money’ – https://www.advisorperspectives.com/commentaries/2017/05/18/fund-managers-current-asset-allocation