This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

We've Added Ocean Rig And Woori Finance To The Portfolio, Sold Blackstone

By Brian Skally

Since our last commentary, the Covestor Absolute Returns portfolio has performed well on an absolute basis, in essentially a very accommodating market environment. At the same time, it has performed poorly on a relative basis. Nonetheless, our portfolio positioning remains largely unchanged.

During the preceding months, we sold positions in Blackstone (BX), United Online (UNTD) and Advanced Emissions Solutions (ADES). In each case, the position was sold because of a change in our estimation of fair value.

In some cases, this decision would appear to have been taken prematurely. However, in my opinion, the best strategy available to the value investor is to base buying and selling decisions on your estimation of a stock’s current value.

Regarding a specific holding, the proposed takeover of Saks (SKS) became a reality when the company reached an agreement with dissenting shareholders on the acquisition by Hudson’s Bay.aThe bidding war, hoped for by some shareholders, never materialized, and the portfolio achieved a modest gain on its holding.

Another portfolio holding, Moduslink (MLNK), reported modestly improved earnings results, suggesting progress in a planned operational turnaround which the market appears to like. (Earlier this year, the company restated several years of results due to accounting errors.)aThe less optimistic view is that operational improvements in existing business lines are likely to be less significant than it may first appear. The company expects to grow via acquisition in order to utilize significant tax loss carry-forwards.aThe investment case then would appear to hinge on the company’s ability to successfully acquire businesses at a reasonable price in what may be a less than ideal market environment.

In other developments, the portfolio also entered into a number of new positions, including a deepwater driller called Ocean Rig (ORIG) and Woori Finance (WF).

Despite what I consider as a less-than-optimal market conditions, the Absolute Returns portfolio will continue to seek attractive opportunities to deploy capital.

The investments discussed are held in client accounts as of October 31, 2013. These investments may or may not be currently held in client accounts. The reader should not assume that any investments identified were or will be profitable or that any investment recommendations or investment decisions we make in the future will be profitable. Past performance is no guarantee of future results.

Brian Skally

Brian Skally

I am employed full time in the private shipping sector, having previously worked as private consultant in the maritime industry


Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,698.18 -77.94 -0.44%
S&P 500 2,059.69 -8.20 -0.40%
NASDAQ 4,880.2280 -20.6570 -0.42%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs