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Nautilus Inc. Message Board

  • astral_tsar astral_tsar Jan 29, 2004 5:31 PM Flag

    Time to Tout

    A couple people were kind enough to ask if I had any ideas. It's extremely hard to find anything good right now, the market is badly overpriced and flaky. I'll toss a couple of picks out there in order of palatability, but buyer beware ok? Do your due diligence, read the filings, be careful out there.

    1. Vanguard Short Bond Funds -- These appear to be good quality, low-cost funds with a bit more volatility risk than a money market but with 2% or 3% yield depending on flavor. I'm not in yet, but I plan to couple this with a long (, long, long) list of stocks that were probably great buys at March '03 levels, and then pray for a Crash in some sector or stock or the whole ball of wax.

    2. American Pacific Corp. -- Makes an ingredient of solid rocket fuel. Good low long-term average P/E. Not much of a grower imo. Just paid a nice dividend, but no idea whether that will recur. Good P/E. Downside is safety -- their plants have occasionally exploded over the years and they haven't necessarily collected on their insurance. I don't presently own this one. Decent possible windfall upside as they're the only North American supplier of that fuel ingredient.

    3. Michael Anthony Jewelers
    Hang on tight, this one breaks every rule in the book. This is a break-even business in the process of being deregistered with the SEC and delisted from AMEX, controlled by one family and very thinly traded. I've estimated a value using the same "net current asset" method that worked well for me on Gateway in April and Metro One in December of 2003. If you don't know what you're doing, stay away. If you do, here's a link that covers the "net current asset" metric:

    BTW the report is packed with food for thought for value investors, covers much more than just this one technique.

    Good luck folks! Be careful out there!

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    • Astral,

      It seems to me that you're pretty bearish right now. In a lot of ways that seems to be the popular view that the market will be going down in the near future. In other words, there's a lot of inflow coming into mutual funds, but if you turn on CNBC everyone is predicting a correction. Is it possible that we're climbing up a wall of worry? That's what I think is going on. You don't see too many people on the talk shows touting speculative plays and if they do, they always qualify it with the usual precau

      • 2 Replies to joker_78_21
      • Joker --

        Good point. My general bearish feeling about "the market" has been pretty high for a while, but that didn't really keep me out of stocks because I could find some pretty solid picks. Like NLS in the summertime. Pretty hard to miss. (Unless you are literally the type who posts about how inventory turnover is a bad thing or whatever. It wasn't a gimme but it was nice.)

        Now it's different -- the bottom is looking really picked-over. Numerically, MAJ is the best pick I have. On paper, I see the "beef." But who likes holding shit that delists? I think it's worth being cautious with something that speculative.

      • open your eyes and see the bigger picture the correction has all ready started

    • One more thought/warning on that MAJ pick. Stock price is likely to sag on the actual delisting, as people panic about liquidity.

      Personally I value 'making money' higher than 'liquidity', but most people see it the other way around.

    • The document I intended to link was the report called "What Has Worked in Investing." The net current asset value metric comes up several times, in increasing detail.

      • 1 Reply to astral_tsar
      • Well, what do you know, one more is edging back into "buy" territory.

        Strattec makes car locks for big automakers, they claim largest market share in the world for that business. P/E not especially low, maybe 14ish. Revenues and earnings static, but EPS has grown nicely due to consistent share repurchases.
        (Disclosure: I bought at $55 and still got. It's thinly traded, so be careful about running it up. Planning to sell around $80 but who knows?)

        For that matter, Berkshire Hathaway looks nice if the B shares get down under $2700 at some point. Probably wouldn't be an error to buy at $3000. I sure as shit wouldn't sell for that. But give it time maybe you can sneak in for less.

17.27Apr 24 4:02 PMEDT