Commodity-oriented companies continued to be the only game in town last week and two of my holdings benefited, increasing in price even as the broad market declined. Helmerich & Payne (HP) was up 4.5% and Stone Energy (SGY - Get Report) was up 3.6%. Both of these companies continue to have valuations well below the median for their industry and I consider them to be attractive.
Rofin Sinar Technologies (RSTI - Get Report) was down 7% last week. I had previously sold half of my position based on valuation concerns and continue to feel that this stock is fairly valued at current prices.
My biggest loser last week was Cal Maine Foods (CALM), which was off 18.1%. There was no news to account for the decline. I assume investors are speculating that earnings in the current quarter are likely to represent peak levels for this company and are therefore interested in selling the stock. This is the type of thinking that could seriously be applied to any commodity company and, therefore, investors need to realize the risk now being taken in energy, fertilizer and other commodity names.
In this particular case, Cal Maine now sells at an enterprise value/EBITDA ratio of less than three times. This seems to discount some future possible earnings weakness. Inasmuch as the company remains on my screening system as a buy, I plan to continue to hold this stock.The table that follows shows all the current holdings in my IRA as of the end of last week:
|CPX||Complete Production Services||3/27/2008||$22.37||$23.18||3.62%|
|HP||Helmerich & Payne||12/27/2007||$39.88||$51.62||29.44%|
|LSR||Life Sciences Research||3/11/2008||$24.22||$27.90||15.19%|
|RSTI||Rofin Sinar Technologies||9/21/2007||$35.06||$43.79||24.90%|
|SCX||L. S. Starrett||12/10/2007||$18.88||$19.54||3.50%|
|SPY||S & P Dep. Receipts||1/14/2008+||$132.12||$133.38||0.95%|
|USPH||US Physical Therapy||1/17/2008||$13.98||$15.42||10.30%|
|One Month Screen|
|No Current Holdings|
|Performance Results As Of 4/11/2008||IRA||S&P 500|
|Full Year 2007||33.0%||5.5%|
|2008 Year To Date||-2.5%||-8.8%|
|Total Return For IRA
S&P 500 does not include income for current quarter.