Five Really Quick Pitches
While it's always to come home at the end of a vacation, not surprisingly when I return I am always swamped with work and family stuff. As a result, some of my recent pitches have been a little shorter than normal. Here's five more recent "quick pitches" for anyone who's interested.
I would love to read others' thoughts on these trades. If you're in them yourself or have an opinion on them, let's hear it.
Long Claymore Dividend & Income Fund (DCS)
"While its name appear as Dremen/Claymore Dividend and Income Fund here in CAPS, DCS has been renamed just the Claymore Dividend & Income Fund.
The fund's former manager, Dremen Value Management, essentially ran the fund into the ground during the credit crisis, causing its net asset value to drop from nearly $100/share to as low as $7/share. Ouch. No wonder Dremen was given the boot.
Today DCS trades at a 13.5% discount to its Net Asset Value.
While most closed-end funds do trade at a discount, I expect that this discount will narrow in the coming years as investors become more comfortable with this now more stable fund.
The fund also currently pays a solid 3% dividend, which should help enhance its outperformance of the S&P 500 in the coming months.
As of 7/31, DCS's top ten holdings included attractive companies such as Johnson & Johnson (JNJ), Pfizer (PFE), Procter & Gamble (PG), Merck (MRK), Glaxo-SmithKlein (GSK), Pepsi (PEP), Coca-Cola (KO), Intel (INTC), and Chevron (CVX).
I think that there's better ways to play energy than Chevron and I personally believe that Intel's acquisition of McAffe (MFE) was beyond idiotic, but for the most part DCS's holdings are extremely attractive."
Long Abington Bancorp, Inc. (ABBC)
"Abington Bancorp (ABBC) is under attack by the activist investor Lawrence Seidman. Mr Seidman recently filed a 13D as an activist shareholder of ABBC.
Seidman has yielded an average return of 40.7% versus a return of 1.4% for the S&P 500 in his previous 22 13D filings. Given his average purchase price of $8.30/share for ABBC, if this stock performs in line with his batting average we have more than 20% upside left."
Long Winn-Dixie Stores, Inc. (WINN)
"As someone who lived in the South for a number of years during the 1990s I am well aware that "The Beef People" as them used to call themselves aka Winn Dixie stores suck. On the infrequent occasions that I did go there, I half expected to round the corner and see goats and chickens grazing in the isles. I haven't been to one lately, but given how bad they were back then anything that the Company's relatively new management team does has to be an improvement.
WINN has nearly half of its market cap in cash and little debt. It's trading below its tangible book value and much that is stuff that they could actually get money for in the event of a liquidation, such as land, trucks, etc..."
Long S1 Corp (SONE)
"S1 Corp (SONE) is an interesting situation. The company recently switched from immediate recognition of all of the revenue from new contracts to recognition of revenue on a percentage basis as projects are completed. This switch has made it appear as though the company's revenue is falling, even though there has been no fundamental change in the Company's business. "
Short Blue Nile, Inc. (NILE)
"Still over-priced even after recent drop. I'm looking for a few consumer discretionary stocks to short to hedge my mostly long CAPS portfolio. NILE, trading at 36 times its estimated 2011 earnings, versus 14 for a company like TIF, fits the bill nicely."