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Varchild2008 (84.34)

Varchild Reveals his Portfolio..Plus a Best Kept Secret Stock Pick



April 02, 2009 – Comments (7) | RELATED TICKERS: BAC , WHR , DPS

I will not reveal my share counts but the following companys are in my portfolio...

1)  DPS                        *Since July 8th, outperforming the S&P 500 by 19%*

2)  WHR                       *Kenmore, Maytag, Whirlpool, 43 cents a share dividend...bought it at $24!

3)  MSM                      *No not the Main Stream Media....It's MSC Industrials Direct!

4)  ATVI                       *Slow Growth stock I bought hard into when it traded in the single digits.

5)  HAL                        *Slow Growth stock...Lenny Dykstra likes Haliburton

6)  CRNT                      *Ceragon Networks beaten down badly...I think it rebounds

7)  FLIR                        *FLIR System's is a keeper long term as they sell what's always needed

8)  BAC                        *Loads of Bank of America for $5.35 yippe!*

Best Kept Secret Stock Pick:

8) EAG                         *If I become a millionairre within 10 years as a stock investor...It's because of American Defense Systems more than any other stock in my entire portfolio.*

Let's do the Math shall we?

A)  One of their advisors is General Peter Pace.  

B)  ADSI  is Caterpillar's #1 Tier supplier and receives Add-On Armor for their Construction Vehicles for the Army known as "Crew Protection Kits."  No other defense stock I know of has anything like these CPKs (hence Today's Press Release showing that ADSI has become a Sole Source Supplier of CPKs to the Marines).

C)  ADSI announced at the beginning of this year in the teeth of the recession that they will grow 52.5% by end of '09 and based that judgement almost entirely off their contract backlog which was huge in Q4 thanks to the popularity of the CPKs which are savings lives in Iraq and Afghanistan.

D) ADSI now has announced today that they landed their biggest contract for CPK for the Marines, and the 2nd Biggest Contract in their company's history.  $30 million dollar contract of which about $15 million or so is realized this year!   This is on top of the 52.5% growth projection.

E) ADSI sells to Police Officers several things:
         1)  Mobile Target Practice Video Screen Systems  (which already have gotten rave reviews)
         2)  Bullet Proof Glass and Bullet Proof Glass Barriers for SWAT protection.
         3)  Armor and Bulletproof Glass Windows for Armored Police Vehicles.

F)  President Obama's own Limousine uses Bulletproof Windows manufactured by ADSI.

ADSI is a conglomerate corporation.... The Conglomerate sector is typically a slow growth sector, but I think ADSI is perhaps the best kept secret in this entire sector if not the entire stock market.

G) Why is ADSI a penny stock????

DEBT Covenants were really close to being tripped....2 third party entities were holding lots of preferred shares of ADSI and if they were to redeem 100% of those shares, ADSI would be dangerously close to bankruptcy.

I think the whole DEBT Covenant and Bankruptcy scares that surfaced in Q1 are now in the past thanks to the Awesome, Superheroes, known as "The United States Marines."

What's good for the Marines.... Is Good for my Portfolio and my Financial future. 
I am not going to sell off my shares at all no matter how high the stock trades up.

I got 3 penny stocks....and out of those 3....ADSI has the most promise to break out of Penny Stock Status.

7 Comments – Post Your Own

#1) On April 03, 2009 at 12:05 AM, motleyanimal (36.66) wrote:

Well Gee Whiz!

If you're going to flash your boobs, I guess I can show mine.

WHX...30% distribution from Whiting Trust, parent is WLL. Just collect the distributions for 6 years in this no brainer. It's hedged nicely for the future in costless collars.

PEO...Conservative closed end fund, Blue Chip portfolio in energy, very low fees and great management at 11% discount to NAV.

CHK...Just opened a short position today. Low NG prices and debt will take their toll. CEO is a gambler and not a good one either.

HYB...Junk debt and leveraged, but these guys know the market, reasonable fees and 15% yield with an 18% discount to NAV.

HUN...So undervalued it's insane. Chemicals with some AG exposure, excellent management, high dividend and will benefit from low NG prices.

These are my core stocks, except for CHK. There are other smaller speculative positions and I have a 30% cash position.


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#2) On April 03, 2009 at 11:27 AM, nottheSEC (78.84) wrote:

Cards on the table in real life. Long term.

DLB is sound and has the moat that will take competitors years to overcome.Good margins on licesning sales. Not zooming up because of slow consumer electronic sales in this recession and "changing of the guard" as fonder Ray Dolby semi-retires.

SE there may be better choices in this sector but sustainable rising divy of $1(7%) and multiple of 9 makes it a great nat gas choice.The fine folks at MF and MSN concur  5/5 stars and 9/10 respectively.  


Note if you invest in gold juniors do so in a speculative market basket.

NXG... Beaten down like all juniors especially with 40 million in Auction rate securties. Still beat estimates by a penny. Reserve not inferred reserve at 1.28 million ounces gold. Over 50d ma.

VGZ heavy inferred deposits.  


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#3) On April 03, 2009 at 11:32 AM, nottheSEC (78.84) wrote:

@Varchild. Good post. I am interested to know what you other 2 penny stocks are. If not I understand... All best.. J

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#4) On April 03, 2009 at 3:31 PM, Varchild2008 (84.34) wrote:

When I chose Haliburton I did some research between that and Cheseapeake (CHK).

I am actually kicking myself that I chose Haliburton as I think I failed to realize how high a P/E ratio that CHK trades for....My bad I guess but I still like Haliburton.

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#5) On April 03, 2009 at 3:32 PM, Varchild2008 (84.34) wrote:

Uhm the reason I haven't revealed the other 2 Penny Stocks is that their activity has gone from robust to bust.

There's no point in wasting people's time talking about 2 penny stocks that won't report anything special until the economy recovers...They expect the recovery to occur 2nd half of '09.
So, I hold on a cautious wait and see mode.

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#6) On April 03, 2009 at 4:22 PM, nottheSEC (78.84) wrote:

Understood on the two others. Thank you.

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#7) On April 15, 2009 at 5:29 PM, Mary953 (84.94) wrote:

Not quite penny any more, but mine include USU and RT.

And I dug this up to thank you.  I read your info on EAG, researched it and bought in.  It is up to 70 cents today which is lovely, given that it was 56 when you posted this blog.  Thanks loads! 

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