NEW YORK (Real Money) -- Doug Kass of Seabreeze Partners is known for his accurate stock market calls and keen insights into the economy, which he shares with RealMoney Pro readers in his daily trading diary.
This past week, Kass wrote that he's buying Twitter on a decline in shares that makes the company a more attractive takeover candidate. He also noted that the steep drop in oil prices will force oil production and exploration companies to reduce capital expenditures, which will hurt the U.S. and global economy.
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Originally published on Dec. 9, 2014 at. 12:07 p.m. EST
I've taken a small long this morning.
If you go back to my initial analysis on Twitter (TWTR) , I suggested that a buy level of about $32 per share was appropriate.
Since Twitter's IPO, social media stocks have done well in the markets (though the sector has been weak in recent weeks).
As I have recently observed, call option activity has been conspicuous. Perhaps the recent management issues move up a possible "event."
Nevertheless, barring a "transaction," I have no illusion of strong relative performance through the balance of the year, but I am attracted to the developing reward vs. risk ratio and I have taken a small long this morning.
I plan to add to TWTR on any weakness.