Last year was a good one for stocks and, by association, for the Bottom of the Barrel portfolio. The Barrel is an eclectic selection of small-cap stocks that are undercovered by traditional analysts and, in many cases, underowned by institutional investors.
As we begin 2004, I've eliminated a number of stocks from the portfolio. Although some of the decisions were difficult, it was time to make room for some new names. I based the decisions partly on performance but also on relevance, taking into account the number of reader responses I received on a particular stock, the industry it's in and its potential to be interesting in the year ahead. Here's the short list:
|A New Year in the Barrel |
Cleaning out the Barrel for 2004
| ||Moog (MOGa:NYSE)||11/7/2003||$54.16||$43.12||25.6%|
| ||Boston Beer (SAM:NYSE)||3/5/2003||18.61||12.55||48.3|
| ||Wild Oats (OATS:Nasdaq)||2/20/2003||13.20||7.25||82.1|
| ||Maverick Tube (MVK:NYSE)||1/23/2003||18.36||14.08||30.4|
| ||Energy Partners (EPL:NYSE)||12/5/2002||14.29||9.40||52.0|
| ||Men's Wearhouse (MW:NYSE)||11/20/2002||23.44||16.22||44.5|
| ||Coachmen (COA:NYSE)||8/21/2002||18.71||15.05||24.3|
| ||Superior Industries (SUP:NYSE)||7/10/2002||43.00||43.87||-2.0|
| ||Fidelity National (LION:Nasdaq)||5/8/2002||13.20||10.58||24.8|
| ||Cost Plus (CPWM:Nasdaq)||3/6/2002||43.15||25.83||67.1|
| ||Rare Hospitality (RARE:Nasdaq)*||2/20/2002||25.88||17.15||50.9|
| ||Hibbett Sports (HIBB:Nasdaq)*||10/24/2001||32.95||13.36||146.6|
|Bottom of the Barrel Income Portfolio|
| ||South Jersey Industries (SJI:NYSE)||6/25/2003||$41.40||$36.90||12.2%||3.91%|
| ||Ameron (AMN:NYSE)*||11/6/2002||37.84||25.30||49.6||2.11|
| ||Hawaiian Electric (HE:NYSE)||7/31/2002||49.39||41.86||18.0||5.02|
| ||UGI Corp (UGI:NYSE)*||6/26/2002||33.74||19.24||75.4||3.38|
| ||Acadia Realty (AKR:NYSE)||6/5/2002||12.41||7.03||76.5||5.16|
| ||Capital Automotive (CARS:Nasdaq)||4/3/2002||33.91||22.95||47.8||4.91|
| ||Alexandria Real Estate (ARE:NYSE)||2/13/2002||58.33||40.25||44.9||3.98|
| ||Integra Bancorp (IBNK:Nasdaq)||1/2/2002||23.00||20.75||10.8||4.09|
|* Adjusted for Stock Split. Source: Bloomberg, Company Reports, TSC Research|
The names being removed from the portfolio -- in no particular order -- are:
- Cequel Energy (CQL:Toronto) Topps ( TOPP) Real Resources (RER:Toronto) NetBank ( NTBK) Huffy ( HUF) Playtex ( PYX) Trico Marine ( TMAR) Baldor Electric ( BEZ) California Water ( CWT) WD-40 ( WDFC) Empire District Electric ( EDE) WebMD ( HLTH) Coastal Bancorp ( CBSA) (which is being acquired).
That leaves us with 20 good small-cap names as the foundation of the 2004 Barrel portfolio. Remember, this is a group of small-cap, largely underfollowed stocks. As such, they are more volatile, and they have a higher level of risk and speculation. Be sure that you thoroughly understand the risks of small-caps -- a lack of liquidity, a lower level (and sometimes quality) of information flow and potentially choppy action in price movement -- before you invest.
With that in mind, here's a quick look at some of the remaining Barrel stocks.