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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

In 2014, I'm dumping Microsoft and more upbeat on gold

By David Levine

The last month of the year was interesting - there seemed to be a melt up into the end of the year, and I was able to take advantage of some of 2013's biggest losing sectors to find some bargains in a market that seems to be getting fairly valued at the very least.

It seems to me that January will be a more active month, but from what I have read, I am happy with the way that 2013 turned out.

One of the best performers for my Covestor Aspect Large Cap Portfolio portfolio in 2013 was Tucows (TCX). I took off half of my position this month as it approached my $3 short term price target. (On January 8, the company was trading at $14 after a 1-for-4 reverse stock split at the end of 2013.)

Tucows management has been sounding quite bullish lately - a lot of startup expenses related to their Ting Wireless venture are behind them and it looks like their core business is doing well.

These startup costs were masking the true potential of the business, and the few analysts who did cover the stock had to readjust their mindset when management guided to a 40% growth rate in 2014. I don't have a crystal ball, but with a 40% growth rate and .14 projected EPS, in my opinion TCX could eventually hit $5 per share. However, it has risen at a quick pace already, so I began to think that I was being greedy and I sold half.

In other news, I refocused my silver bet - a losing bet in 2013 - away from the iShares Silver Trust (SLV) and into Pan American Silver (PAAS). I also added a position in Newmont Mining (NEM). I like to look among the year's losers in December and see if I can find some bargains, and the precious metals miners seem to fit the bill nicely.

Pan American Silver is especially interesting - selling at well under book value, with a 4.2% dividend (as of Jan. 3) and a share buyback in place.

While I am not a gold bug, I do expect gold to rebound off of these levels a bit since there is almost no fear in the market and at some point there should be a certain amount of inflation.

I have no way of knowing this for sure, but I could see where these stocks could rebound nicely from tax loss selling and then bounce 20% or more from their lows on the slightest whiff of anything positive. In the long run, while I don't expect gold or silver to make new highs, I think that gold can rise to $1600-1750 and silver to $30-35.

Finally, I feel like I could sell Microsoft (MSFT) at any time. They don't seem to have a plan other than possibly hiring Alan Mulally to run the company, which makes no sense either. The big problem is that the real magic is gone. Microsoft is kind of like a utility and after its big run in 2013, I'll take my money and run.

And regarding money, I still have a large cash position and I am still having a hard time finding things to buy. Maybe we will get a pullback, but if I had to guess, the pain trade is still higher.

While I voted Libertarian and think that both mainstream parties are corrupt, I have a belief that we will hit Dow 20,000 before Obama leaves office.

I have now way of knowing for sure, but I will go so far as to tell you to avoid purchasing shares of either AVT Inc. (AVTC) or MedBox (MDBX). It is not just that they are ridiculously overvalued - it has to do with their management. Happy New Year.

DISCLAIMER: The investments discussed are held in client accounts as of December 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. The opinions and views expressed herein are of the portfolio manager and may differ from other managers, or the firm as a whole. Past performance is no guarantee of future results.

David Levine

David Levine

I am a value-oriented investor and a former financial adviser for Prudential Securities. I left the industry in 2000 and

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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 16,938.96 -144.84 -0.85%
S&P 500 1,982.45 -5.53 -0.28%
NASDAQ 4,453.66 -18.4480 -0.41%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs