Given the recent volatility in the market, and the fact that I haven’t posted anything in almost 2 weeks, (been busy at the bar, no joke) I’ve decided to write a second August portfolio update. And what an interesting couple of weeks it’s been, especially the last few trading days. The DOW dropping over a thousand points, rebounding, subsequent drops… it’s been wild. So what’s changed with me and my portfolio?
Well, three of my positions have been relatively unaffected. First Solar, Inc. (NASDAQ: FSLR) has bounced around a little, but not enough to hit my lower, second buy point at $37.40. I’m considering raising it closer to $40, but with the current volatility, perhaps I should leave it alone. Maybe I’ll up it a buck, maybe not.
Constant Contact (NASDAQ: CTCT) and Mattel Inc. (NASDAQ: MAT) haven’t seemed to move around too much, which I see as a good sign for them, though I still would like to see lower prices so I can snap up some more shares. I’m a patient person. I read an awful lot about Mattel having to cut its dividend if things don’t turn around. Maybe fear over that will give me an opportunity to get some shares on the cheap.
Now for what’s a little more interesting. Chesapeake Energy (NYSE: CHK), interesting and painful. So my average price is $13.61 for 59 shares. Last update I told you of my buy order for $6.25. Well, I lowered that to $5.75 the day before yesterday, JUST before the $6.25 order would have been filled. It never got to my lower order, and is now about $6.80. I’d love to tell you that my decision to lower the limit order was based on something other than fear, but I’ll cop to it. I was afraid to own more of this company. CHK is the first company I bought, back in April, and I didn’t think there was much chance of it going bankrupt. Now a lot of people are ready to sign the company’s death warrant. If oil and natural gas prices don’t rebound for a long time, it’s a possibility.
While I have absolutely no plans for selling what CHK I have, I’m cautious about buying more. If the price continues to go down, I believe I’ll make one more purchase to lower my average cost, but I don’t see myself buying in four times, like I’d be willing to do in a more stable company.
Daktronics Inc. (NASDAQ: DAKT) is another interesting point in my portfolio. The company reported earnings of 9 cents a couple of days ago, missing the analyst estimate of 14 cents. That’s a pretty large miss, percent wise, and of course in this market the stock got hammered. In the conference call they talked about some of their customers being cautious in this economy, but their bookings are still strong. It seemed like some of their missed revenue came from working around their customer’s schedule, that sort of thing. I bought in at $10.10 in early June, and yesterday at $8.30, for an average price of $8.99. It’s at $8.50 as I write this. I’ll have come within 12 cents of ‘calling the bottom’ in this if it doesn’t go back down. (Surely 24 hours later it’s safe to pat myself on the back for that one. Right? Right?)
Anyway, I have one more buy slated for DAKT should it come down more. (Only three maximum buys here, because the company is so small.) Still deciding at what price to put the limit order. The 5 year low is at $6.32, so part of me wants to put it just under $7. But then again with the way things are moving in this market lately, maybe just hold off and see what happens. I really like the prospects for this company, so I’m glad to get the lower price I got yesterday.
What’s on the horizon? What am I looking at for the future? I have limit orders in for two companies that I don’t currently own. 8point3 Energy Partners (NASDAQ: CAFD) at $13.25, and PayPal Holdings, Inc. (NASDAQ: PYPL) at $28.25. I mentioned 8point3 in my write-up of First Solar. I might do a write-up of PayPal soon.
So while I’m down about $440, I think I can handle some more pain if it comes my way. In fact, I’m sure of it.
As always, feel free to look at my portfolio and see how I’m doing. And please READ MY DISCLAMER. Make your own decisions, do your own research, and never rely on any single source for information. I am not a financial professional; do not rely on me as such.
Michael, the Stock Picking Bartender