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Compass Diversified Holdings Message Board

  • skierxtrem3 skierxtrem3 Mar 17, 2010 11:23 AM Flag

    Closed out my position this morning

    Sold out this morning- I really wanted to own CODI for a while, but from a yield/distribution valuation I think it got ahead of itself. Though in the past it has been as low as 6.5% so it could go quite a bit higher from here. I had purchased very low back in June with a 96% gain. The bad side is it is a very large short term gain on over 11k shares. There are quite a bit of variables that could actually make todays price look reasonable...Staffmark improving, New platform add on's generating more cash than expected, Fox getting large military contracts, New add on businesses with the remaining cash adding to CAD ect... I can think of quite a few things that could drive it to near 20 not to mention the rising tide in the market alone. I wish the holders as well as who ever bought my shares luck (nice doing business with you:) I will be back if I find the price/value appealing again.

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    • Sorry to hear it. Sounds like you just dumped a geyser of cash (18% on money invested) that is way beyond what any earnings yield for anything will be for many, many years (maybe never) -- and gave yourself a short term tax hit too! O.U.C.H. But judging from your post, I think you knew that already ....

      Assuming you weren't overinvested in it, the thing to do would have been to average up just a little. Or if you were worried, protect yourself with some puts on an ETF it tracks.

    • I hear ya. I'm up almost 80% and I know I should probably lighten up alittle, but for all the reasons you stated and more, I just cant seem to think this can go much lower, and can go much much higher. I just dont have a good enough reason to sell. Good luck to you in what you decide to buy and hope to see you back in CODI again for another double!

      • 2 Replies to lneedlesb
      • Just to add to the confusion about hold/sell ...

        Today the senate passed the so-called jobs bill and its ready for the president's signature. It does include a tax holiday for new hires of the unemployed, and tax credits if the new hires remain employed one year from now. I haven't read the bill (+300 pages), but we could get some nice little surprises down the road from Staffmark's new hires this year and next.

        And like others, I have to weigh the consequences of short term cap gains taxes, against the likelihood of a sufficient share price correction (not likely IMO with the divi chaser flooding out of their 0% MMFs and into anything that Yahoo reports as paying a dividend regardless of the accuracy of Yahoo's reporting or the financial solvency of the underlying stock). I've been taking money off the table for several months now (not CODI), then watching the recently sold stock price just keep going up. Although no stock price moves in a purely linear direction, it sure appears to me that CODI is more likely headed higher, rather than lower. Of course, my opinion means it will probably tank just because ...


    • Anytime you can find a better opportunity in another stock (after factoring in the short term cap gains), I say "go for it."

17.02-0.03(-0.18%)Jul 29 4:02 PMEDT