MoneyMiser Picks

Freeing up some cash

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Buying Visa on pullback today, over "credit card crackdown." People are still paying with plastic more and more, and Visa will still get its transaction fees from it. This stock continues to go up, and I see it following Mastercard's lead all the way to $150+ per share.

Taking profits in several stocks:

Selling all of my ACI. It's up 24% since I bought it. Dollar getting stronger may impact it.

Trimmed positions in PCP, CSCO, INTL, and BHI to free up cash.

Sold off half of my position in PCP after 17% advance. Still like them long term.

Sold off 1,000 shares each of Cisco & Intel, after they finally turned positive. This equals about ¼ of my position in both. CSCO of course had a wonderful rally Friday, making it up 10% overall for me. Intel, I was a bit late selling into strength, but it's still up 7% for me since I bought in.

BHI, I sold about 1/3rd of my position due to the drop in the oil services sector. I had a funny feeling that when BHI crossed 20% gains for me that it was going to fall. I should've acted on that feeling. BHI still up 14% for me since I bought it though.

Dark times for my solar picks:

LDK the only one of the 4 stocks in the black, up 4% since I bought in.
--AMAT, down 2%
--SOLF , down 12%
--ESLR down 21%

Overall, I think I poorly timed my entry into these.

What I bought into recently:

Got long some bio-pharma. Genetech (DNA) is nearing support level. Building a position between $65-70.

More MO. Altria dropped a bit recently, so I bought in. MO has got get up and go.

KALU. Kaiser saw some retracement, and it's a Karen Finerman favorite on Fast Money. It's got the commodities play, and airline backlog story going for it.

GE. I bought $50,000 worth on the day it got obliterated by the earnings news. Guess what, it's back up. Gee, who didn't see that coming.

WDC. PC sales up equal good news for the hard drive maker. I'm up 5% since my buy-in. I think it has room to go higher with the shifting of money from commodity plays to Tech.

Holding on to:

YUM - Still yummy, but not moving much. Still up 17% since I bought in, and that's damn good.

VZ - Verizon starting to gain some momentum. May sell this soon to take profits. Up 11% so far.

NTRI - I told you Nutri-System would rebound. Wish I had bought in at $14. Still up since I got back in it though, and it has A LOT of room to go higher. Heck, they've even got Larry the Cable Guy doing ads for them now. Get 'er done!

BUD - The king of beers is grinding away higher. Up 6% since I bought in.

HUM - Slowly starting to rebound from the health stock obliteration in March.

TSO - I think it can, I think it can, I think it can... Summer driving season approaching, crack spreads narrowing a bit more this week, and Lenny Dykstra even saying it a value play! Come on folks, like Citi at $20, Tesoro at $25 is a STEAL!!! You're looking at a likely double, and even more likely 50-75% advance from current levels within 12-18 months.

MSFT - Wow, a roller coasted for Mr. Softy. Late today it came out that Microsoft will more than likely RAISE its price for Yahoo! We'll see what this does next week, but short-term I think it's more beneficial for YAHOO! Shareholders than MSFT. Still, MSFT below $30 is a lead-pipe lock BUY

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2 Best of breed stocks in bargin bin

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Amazing what falls in the stock market sometime. What if I told you that two best of breed companies we're offering you a more than 50% discount on what their fair value estimated prices were?

Well we've got such a situation, thanks to the fears being force fed to us about the economy going down the toilet.

They are Garmin and MGM Mirage.

The case for GRMN:

The premiere name in GPS devices. They put competitors like Tom-Tom to shame. And really, who believes those God awful commercials from Tom-Tom actually helps Tom-Tom's bottom line. Forget Tom-Tom, or Sue-Sue, or whatever name you want to double... give-a-give a Garmin. Makes it much simpler to get your idea across.

Garmin won't be dragged into a price war because of the quality of their product. The company also makes money off of selling its GPS technology to cell phone makers.

Then there's the financial side. And boy does Garmin impress. Book value per share has climbed from 78 cents per share in 1998 to $10.83 per share in 2007. And Return on Equity has never dipped below 22% in the past decade. Garmin's ROIC in the past 5 years average is 34.5%, which is more than four times the industry average, and more than three times the S&P 500 average.

With numbers like that, Garmin can't be trading below fair value can it? Oh Mr. Market is having another one of his manic depressions over this GPS giant. Current fair value estimate, given it's current earnings, projected average growth rate, and an average past P/E for 10 years is approximately $116. It's selling at $50 per share as of end of Friday trading, and that's AFTER an $8 per share move from Monday!!! So yes, it's up nearly 20% in a week, but it has a lot more room to grow.

The case for MGM:

Fair value estimates for this stock given it's current earnings, projected average growth rate, and an average past P/E for 10 years is approximately $111. From that level, it should hit a target price of $444 in 10 years, averaging about 15% compounded ROI (minus expenses of investing and taxes).

Then you've got the properties. Macau, the Bellagio, the MGM Grand, and several new international hotels/casinos including a new Middle East venture. This company can thrive when the U.S. market slows down thanks to its international exposure.

Then there's the book value and Return on Equity story. In the past ten years, book value per share has increased from $4.63 per share in 1998 to $20.63 per share as of 2007. In five of the past six years, Return on Equity has been more than 10%, and increased the past five straight years.

MGM's longer track record and success as a public company, makes it a more stable name to invest in than it's bigger competitors Wynn or Harrah's.

Both GRMN and MGM have three key technials in common:

1. Both recently crossed above their 30 day moving average
2. Both of their Stochastic oscillators are surging. MGM above 50, and GRMN crossed above 80.
3. Both MACD divergences are approaching 0. And the trend looks positive.

So I'm buying both for my SLO2 account and my longer term Marketrocracy account.

Other new positions:

Citibank's drop back below $24 per share has me buying in. This is purely for a value TRADE. I predict at least a 15% return within a month.

Pfizer dropped below $20 per share. The last time this happened, Prizer shot up above $22 quickly (like it was injected with Viagra or something... lol). I don't see why it won't do it again. Heck PFE below $20 is a great long term investment for both the dividend, and turnaround potential.

I added more to my Visa position on the dips this past week. I still feel Visa has tremendous long term potential.

Holding on to: WDC, YUM, BHI, INTC, BUD, MSFT, NTRI, CSCO, DNA, VZ, GE, SIRI, TSO.

Selling HUM, AMAT, MO, PM, ESLR, MRK to free up cash to buy GRMN & MGM. Also, because I just don't understand these stocks enough.

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