One of the least auspicious buys that we have made as a charitable trust was last year when we bought AbbVie, (ABBV) - Get Report, a pharma company with its biggest drug three years from a loss of exclusivity.
They call it an LoE. We bought it when it had a 7% yield. We believed in the pipeline that the company laid out and told us about when we met with management. We met with them one on one and we met with them listening to the conferences.
We believed in that Allergan purchase. Remember that Pfizer (PFE) - Get Report was trying to buy them but … that fell through and AbbVie bought Allergan. So what happened after we bought it? Of course, the stock dropped precipitously. Did we feel like idiots? No. We bought more. The stock was on sale.
The next thing you know AbbVie’s up 30 points. Why? Simple. Management told us they were going to do X and then management did X. Patience, patience, kept us in AbbVie.
Boeing, (BA) - Get Report. When we first started buying Boeing, we were betting that Chinese relations were about to get better, that MAX orders were going to return and that covid would be beaten. And so what happens when we buy it? The stock drops 25 points instantly. What do we do? We bought more and more and more.
Why? Because nothing had changed about our reasoning, and Boeing's management turned out to be better than many people thought. Next thing you know the stock rallies 50 points on the exact same thesis.
And I do want to point out before we go on that work I've done just this morning on Boeing tells me the bears may be very wrong because of some big orders that could come from Amazon (AMZN) - Get Report that signed out its own fleet and United Parcel (UPS) - Get Report is short planes.
Now, they may end up buying used planes, but then the airlines will buy new planes. And I know that Amazon, when I met with them, is committed -- they want to lower their carbon footprint. The best way to do it is with new planes. So I have even more reason to buy Boeing at 213, which to me is just too low. … Boeing – It’s a buy even after it had that dramatic run. I hope only that it goes below 200 so we can buy more.