May Portfolio Update

My last portfolio update was in February, so I figure it’s about time to have another one. I’m certainly happier with my performance now than I was back in February. While at the time I was beating the market by a wide margin, I was still in the red. Now, as of writing this, I’m beating the market, but I’m in the black! I’ve made a profit of $947.32, while if I’d invested in the market, I’d only be up $194.02. Check out my portfolio to see how I calculate Mr. Market. These would be the REAL gains if I sold everything NOW, at market, as I also include the future selling transaction costs of my current positions in my numbers.

But while I’m happy with how things are going, all is not rainbows and butterflies. If I’d written this a week or two ago, it would have been pure euphoria. At one point I was up just shy of $1900, while Mr. Market was up about $350. You, my readers, would have been disgusted with my level of self-satisfaction. Yeah, I was patting myself on the back real good there for awhile. My fortunes have been in a downtrend the last week and a half, but I’m still doing very well.

Chesapeake Energy (NYSE: CHK) has been doing better lately. My cost basis on CHK is $8.38, and it’s now at $4.12, so the loss is about 52%. CHK has given me problems since I started, it being the first thing I bought. But at least it’s not $1.50 like it was in early February. No other stock in my portfolio illustrates the fear/greed cycle of Wall Street quite like CHK. One day people who own it are afraid it’s going to go bankrupt, the next day people who don’t own it think it’s going to make it through this low commodity cycle, so of course they have to buy! Personally, I’m willing to stick it out and just own it. Part of me wants to delete it from my spreadsheet and just forget about it for now, maybe check on it in a year. But that’s just not how we do things around here.

8point3 Energy Partners LP (NASDAQ: CAFD) is still chugging along, bouncing from $14 to $16, tossing me a nice dividend now and then. My cost basis here is $12.80, and CAFD is at $14.45 as I write this, so an 11% gain, about 15.5% with dividends. I don’t plan on getting rid of this one anytime soon either. I think one day people will realize the potential here and it will take off.

PayPal Holdings, Inc. (NASDAQ: PYPL) is doing a good job for me. My basis is $32.35, and it’s at $39.51, so about 20% to the positive. I love the company, and their growth potential. That said, if it has any significant strength in the near future I might sell. I feel as though there will be a better entry point in the future, despite the strength of the company. It’s something I’ve been thinking on…

Ambarella Inc. (NASDAQ: AMBA) isn’t doing so hot at the moment. My basis is $38.30, and the stock is at 36.80, so I’m down about 6%. At one point I was up about 22% on the position, but it has recently tanked. It’s now almost exactly where I got my second of two buy points in. I still believe, and would be willing to buy more somewhere around $27.

Energy Transfer Equity (NYSE: ETE) is where things begin to get really interesting. In January I bought ETE at $6.75, and in February for $4.85, for a cost basis of $5.58. Fast forward a few months, and it’s at $12.91 for a 128% gain. The current yield on ETE is almost 9%, but my yield on cost is slightly over 20%. In fact, I should get a nice payment in my account next week. The merger drama with Williams Companies (NYSE: WMB) has driven much of the movement here. I don’t have the space to get into all the details, but I want to see the deal re-negotiated so that ETE doesn’t have to pay any actual cash to WMB shareholders. I want to have my cake and eat it too. Not interested in selling here, despite the huge gain. Of course I realize I might regret that decision. Give me another $5 on the stock in the next few months, and I might consider it. Yes, I’m being greedy, but I still believe in the long term health and profitability of this company. Not willing to sell here and miss out, even if it means risking some GREAT short term gains. If I sell at $18 and then miss out, I’ll feel bad, but not QUITE as bad.

Baker Hughes (NYSE: BHI) is holding up well. I bought it a week or two before the merger with Halliburton (NYSE: HAL) finally fell through. BHI didn’t tank like some people thought it would. The $3.5 billion HAL had to pay BHI was the reason for that, in my humble opinion. I also like BHI’s plan to buy back stock and pay down some debt with most of the money. I think Baker Hughes has some really smart management, and I’m willing to keep this oil services company right where it is, especially since BHI already had a pretty nice balance sheet to begin with. I’m up 7% on the position.

Earlier this month I got the opportunity to get back into First Solar (NASDAQ: FSLR) at $55.00. I sold it back in December for $63.52 for a 36% gain. I’m back in, and happy about it. I LOVE First Solar. When FSLR recently reported quarterly earnings of $1.66, they beat the street estimate of $0.87 a share by a wide margin. Revenues didn’t quite live up to expectations, but the real shake-up was that CEO Jim Hughes was leaving to be replaced by CFO Mark Widmar. Ok, just give me the stock on the cheap. FSLR is now at $49.67, for a nearly 12% loss. Do I sound worried? In fact, I have an order in to buy more at $48.50. I didn’t get two buy points in before, I hope I do now.

Update: First Solar did hit my buy point at the end of the day, closing at $48.56, with a low of $48.49, just a penny under my order. I’ll get some nice bragging rights if that’s the low.

What am I looking at now? I’ve been following The Mosaic Company (NYSE: MOS) for a few weeks now. They mine and produce potash and phosphates used in fertilizer. Their industry has been hit by low commodity prices, though unlike oil, there hasn’t been much of a rebound yet. I won’t go into it much here because of space, and I plan to do a write-up of the company soon. I certainly will if I buy some. What’s holding me back is that cash now makes up slightly less than half of my account. This is because of buying First Solar and the awesome gain in Energy Transfer Equity. With the overall market as historically high as it is, I’m not overly comfortable initiating a brand new position. If MOS falls significantly though, I just might be tempted. Much the same could be said for Fitbit, Inc (NYSE: FIT), which I have covered in the past. I thought I missed out, but it’s starting to come back down to more attractive levels.

As always, feel free to look at my portfolio and see how I’m doing. Usually I own or plan to own stock in many of the companies I write about. Please READ MY DISCLIAMER. 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.

Thank you,
Michael, the Stock Picking Bartender,

Reno, Nevada

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