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CLCT update

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October 14, 2012 – Comments (5) | RELATED TICKERS: CLCT , INTC

I have been out of CLCT since February, when I got out at 15.67 or close to it.

Here is a recent shareholder update from the CLCT Investor Relations official website:

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NEWPORT BEACH, Calif., Oct. 5, 2012 (GLOBE NEWSWIRE) -- Collectors Universe, Inc. (Nasdaq:CLCT), a leading provider of value-added authentication and grading services to dealers and collectors of high-value collectibles, today announced preliminary results for its first quarter ended September 30, 2012.

 

For the first quarter of fiscal 2013, service revenues are expected to be approximately $10.7 million and operating income is expected to be approximately $1.2 million, compared to service revenues of $11.9 million and operating income of $2.5 million for the first quarter of the fiscal 2012.

 

Cash at September 30, 2012 is expected to be $19.5 million, compared with $21.2 million at June 30, 2012 and $20.6 million at September 30, 3011.

 

Michael McConnell, Chief Executive Officer, stated, "The expected results for the first quarter, reflect lower revenues and operating income from our coin business as compared to the first quarter of the prior year. In response to this general market decline, during the latter part of the quarter, we reduced our coin operating costs by approximately $1.1 million on an annual basis, to more closely align our authentication and grading capacity to current expectations. Moreover, we will continue to closely monitor our cost structure and consider other actions to improve the profitability of the business."

 

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Well, that pretty much says it all.  But if you go back to this post from my CAPS journal in February 2012, the handwriting was on the wall, clear as a bell, on the past 6 months of income statements from the company.

 

I am trying to get better about taking my own advice.  In this case I executed correctly, noticing that something was wrong and selling at the peak.

In the recent case of INTC, however, I noticed the stock was cheap at 19, bought some and declared my conviction that I had a 15% margin of safety; Berkshire Hathaway followed suit and bought at 21, and so I got over-exuberant and bought more at $27, right when BRK was selling.  I am still holding that INTC and my all-things-considered cost basis is a little over the current stock price.  That's a way of being right - INTC at 19 was undervalued - and not taking that advice - by my calculations, INTC at 27 was overvalued, no longer undervalued.

How about it, Fools?  Do you always take your own wise advice? 

5 Comments – Post Your Own

#1) On October 14, 2012 at 10:48 PM, rd80 (98.71) wrote:

Your calls on CLCT and INTC have been pretty solid.

I don't know if it's so much taking your own advice or just human nature that makes it so difficult to cut a winner loose even when you recognize the prospects aren't as good as when you bought.  I think it's easier to make a sell decision on one you got wrong - although still not easy.

An example for me was MCD at the beginning of the year.  It had a big price run and my 'wise advice' to myself was to sell covered calls.  Would have been a brilliant move, but I never did it.  Still holding MCD.

I believe the most valuable personality characteristic any stock investor can have is the discipline to take profits on a winner when it's gotten expensive and the discipline to take a loss and move on when you recognize that awesome stock that couldn't help but shoot up wasn't all that awesome after all.

FWIW, I'm also still holding INTC.  It's valuation isn't looking too bad after pulling back and I still like it as a long term, dividend growth story.

I guess that's a long, rambling way of saying, no, I don't always take my own wise advice.

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#2) On October 15, 2012 at 2:54 AM, awallejr (82.77) wrote:

I liked INTC at 21, I didn't like it at 29.  It is near 21, so I like it again.

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#3) On October 16, 2012 at 4:34 PM, ikkyu2 (99.38) wrote:

For the record, I think INTC is kicking around at or pretty near its fair value; I like its dividend; and I like its 5 year prospects as the biggest chip builder, biggest chip research, and biggest chip fabber on the planet.  I am neither buying nor selling at this price.

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#4) On October 16, 2012 at 4:35 PM, ikkyu2 (99.38) wrote:

Er, and also for the record, I'm holding an INTC long position, have been since 2011, no plans to change that in the next year.

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#5) On October 16, 2012 at 10:52 PM, awallejr (82.77) wrote:

Yeah I am eyeing it again but only if it gets beat up to under $20, otherwise I wish the longs good journey but I like a lot of other stocks more at the moment.  I still think the mlp space has a lot of value yieldwise and tax treatmentwise.

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