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TMFHelical (98.72)

Helical Portfolio Update 3/17

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March 18, 2011 – Comments (0) | RELATED TICKERS: KNDL.DL , PPDI.DL , CVS

It has been quite some time since I mentioned the Helical Portfolio.  Oh well, life intrudes.  There have been a lot of changes, so I do want to capture my thoughts on the whats and whys (this being something of a public notebook for me).

Here is the last commentary.

As of last night, the port was at $51,678.90, up ~3% year to date (and its up today a few hundred bucks so far).  But there have been a lot of changes since that last commentary.

The port stands with ~20% cash at $11089.15 and:

AMED 75sh

ATHN 50sh

BRLI 150sh

CAH 70sh

CERN 25sh

CPHD 200sh

EXEL 300sh

GHDX 200sh

JNJ 90sh

MDT 100sh

NVS 50sh

SGEN 150sh

Since the start of the year, I have collected dividends and interest of $94.81. Dividends from CAH ($13.65), CVS ($9.38), JNJ ($48.60), and MDT ($22.50).

Gone from the portfolio are CVS (sold @ $34.20 on 1/31),  PPDI (sold @ $29.0801 on 1/31), Bio-rad (sold @ $108.28 on 1/31), and Kendle (sold @ $9.0701 on 3/8).  I also reduced my position in Cepheid by a third, taking some profits (sold 100sh @$23.6401 on 1/31).  I had taken profits previously on Cepheid in October of 2010 as well.

BIO (20sh from 4/14/2010) for +$21.95, 1.0% gain, 1.3% CAGR

CVS (75sh from 7/2/2010) for +$405.21, 18.6% gain, 34.0% CAGR (includes dividends)

CPHD (100sh from 9/25/2009) for +$1061.57, 81.9% gain, 55.8% CAGR (LIFO)

KNDL (300sh from 9/17/2010) for +$23, 9.6% gain, 21.5% CAGR

PPDI (100sh from 5/8/2009) for + $895.65, 42.4% gain, 22.6% CAGR (included dividends)

PPDI (100sh from 9/25/2009) for + $835.60, 39% gain, 27.6% CAGR (included dividends)

Some of the sales had a macro slant to them.  As the issues in the Middle East (Egypt) came to the forefront, and as I felt the market overall was getting rich, I wanted a bit of cash available, so lower conviction holdings were let go.  That was why Bio-rad and PPDI got sold.  I'd love to own both again at lower prices, especially PPDI which is really proving itself to be the steady and reliable play in the clinical CRO space, performing well while others are still showing choppy results.  But, I don't much care for their share buyback (I am often critical of share buybacks), so they go back to the watchlist.  I fully expect to own PPDI again.  Given that BIO was a play for a potential takeover, it was always low conviction, and I'm happy to take meager gains.  Cepheid was the largest position in the port, so gains got taken there as well (its about even with JNJ now as still highest positions).

I like CVS, but the piece I like most is the underperforming CareMark side.  The brick and mortar stores are facing increased competition from the big boxes (Wal-mart, Target) and mail order.  While the local pharmacy will not go away (ever?), I want a benefits manager with the increasing wave of generics coming, and think Medco might be the better play.  But, I'll sit in cash untilI get a better price.  Very hard for me to give up a dividend growth company, so I might own CVS again.

Kendle was a bummer.  I had hopes that the revenues would continue to grow, but they stagnated and may continue to do so.  I could have gotten a better price earlier, but held through earnings, despite other CROs (other than PPDI) reporting ho-hum quarters.  I don't want to own this until they get the debt refi done, as I think they are getting cheaper over the next couple of quarters.  But I think they will continue to be around, so if they get clobbered by the next couple of quarters and a tough refi, then I'm likely a buyer again.

I'm content with the other legacy holdings, but may let MDT go, or part of it at closer to $40.  I'm not sure they won't face increasing margin pressures going forward as I think the device market will get more price sensitive in coming years (but not right away).  Mindray is a company I'm always looking to add if I can get a price I want, as I think the chaeper unit / lower frill device manfacturers will thrive into the future.  

New port additions were Cerner and AthenaHealth (the latter of which has no capital letters, but I'm adding them anyway as that annoys me).  Both were added on 2/24, CERN @ $97.82, ATHN @ $45.11.  The former is up, the latter down so far.  Both are opening momemtum plays into the trend toward electronic health.  Athena will be choppier and may be the bigger opportunity, I may let it go it continues to drop, but would likely then look to re-eneter if momentum gets reestablished (I actually look at TA on this one, but crudely).

Enough for now. The port has some speculative holdings right now, as I intend it to, but plently of cash as well.  I'd also look to add to the JNJ near here, but especially if it gets cheaper (have to wait now anyway).

TMFHelical

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