Which one of these 2 chart lines looks better to Rich Smith (TMFDitty)?
Back in May of 2010, Rich Smith wrote Wall Street's Buy List article in which he mentioned one of my picks: SFI (now STAR).
Here is what he said:
"Meanwhile, CAPS All-Star dragonLZ cites a mysterious "three-ten method" as indicating that "SFI is a winner." I don't have a clue what a "three-ten" method might be. What I do know is that iStar lost more than $700 million last year, while rival Annaly Capital (NYSE: NLY ) earned nearly $1.9 billion. (Which of those numbers sounds better to you?)"
So how have these 2 stocks performed since the Rich's article? Let's take a look at the chart below:
Ouch. NLY is down 37% while SFI / STAR more than doubled (for comparison purposes, S&P500 returned 64% during the same time frame).
To be fair to my three-ten method, let's just mention that at the time when I first picked SFI and wrote my "SFI is a winner based on my three-ten" pitch (on 4/2/10 - a month before Rich's article), SFI was at $4.82 (much lower than $7 a month later when Rich wrote his article) and NLY was at $17.33.
Today, SFI (STAR) is at $14.23 (that's +195% return) and NLY is at $10.03 (-42% return).
I guess Rich was right when he said in the opening of his Wall Street's Buy List article:
"Actions speek louder than words, as the old saying goes."
Happy New Year, everyone!