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Week of Fri the 13th

Recs

2

July 14, 2007 – Comments (1)

All Friday the 13th myths aside, this was a very good week for me – the two biggest stock holdings in my real portfolio are CSCO and CVX. Cisco seems to have found some buyers in the last couple weeks. IMHO, with its solid growth rate, dominant market position and huge cash balance CSCO could easily trade up over $35 by year-end. And Chevron has been setting new high after new high the past couple of weeks.  Maybe some big money managers took notice when Juan Pablo Montoya put the Texaco car in victory lane at Sonoma a few weeks ago. More likely sustained high oil prices and a positive interim 2nd quarter update are behind the run-up. CVX is starting to look a little pricey based on the PEG ratio, but I suspect the analysts don’t have current oil prices in their models. If you’re considering either of these, I’d look for a bit of a pullback before buying in – although you may not get one. I’m leaning towards riding this run a bit longer, then taking some profit and scaling these two back to more of an equal weight.

     CAPS Commentary

I’m going to start adding a reply to my pitches explaining the reasoning when I end picks. It forces a little thoughtfulness into the process and should give other CAPS players ammunition to poke fun at me when I leave points on the table. 

I swapped out Goldcorp (GG) for Northgate Minerals (NXG) in my gold basket. The primary reason was NXG’s stronger fundamentals. I still think anything leveraged to gold is headed higher, but didn’t want the portfolio that overweight one sector. All the other add/drops are covered in the pitches. 

Some strength from the gold sector, CSCO, CVX, a few picks going positive and some shameless ‘dumpster diving’ brought my player rating back up to the 98’s.  The cheap points were from Kodiak Energy Inc. (KDKN.OB). Fellow Fool hall9999’s blog highlighted Kodiak and the successful approach of mining spam e-mail for underperform candidates. A quick scan of the key stats showed Kodiak selling for the bargain price of 98 times book and 11,000 times sales. You will want to shower after picking stocks like KDKN. Many on CAPS aren’t in favor of this approach, and they have a valid point because it probably does skew the ratings. Perhaps a topic for a future blog.

I’m up to 7 groupies. Thank-you for your votes of confidence. There must be a better term than ‘groupies,’ but nothing comes to mind at the moment.

And, the elusive blogging charm has yet to make an appearance. Maybe TMF should come up with a special charm for the Fool with the longest time between first blog and charm received.

Disclosure:  As noted above, I own shares of CSCO and CVX. I don’t own any GG or NXG, but do hold Yamana Gold, which is part of my CAPS gold basket. I’m not crazy enough to have real money anywhere near Kodiak Energy. 

As always, recs and thoughtful comments are welcome.

Thanks for reading and have a great week.

1 Comments – Post Your Own

#1) On July 14, 2007 at 10:50 AM, TMFSpiffyPop (99.40) wrote:

Great habit -- typing in Closeout Pitch when you close out. I have tried to do the same thing for every pick I end.

I think we rob ourselves of great learning opportunities -- both for ourselves and for others -- when we do not type in pitches for our picks. I've tried to pitch every pick I've ever made. So... I agree. :)  Fool on! --David G.

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