Week 8 Review

I was down slightly with the markets for the week. YTD, my portfolio is up by 4.16%. I am reasonably pleased given that I have completely misread the market thus far. I was expecting a correction or consolidation, but it never came. So far, the market has been pretty healthy and buy-dip has been a correct strategy. With more than 30% of my portfolio in cash, a 4% up is not a bad result.

My view is no changing though and I remain cautious here. Having said that I did add a couple of positions here.

First I bid some HIS.TO and got filled on Friday. This is a regional department store, which is not an exactly hot sector, but I believe this one is simply too cheap to ignore. At this level, it is traded at about half of its revenue, 10x of its 2006 earnings, and the company is growing at 10% revenues, and 30% earnings. Although the department store generally is a very difficult and competitive sector, HIS.TO is focus on small markets where large department stores and box stores ignore (lack of scales). The story sounds very much similar to Northwestern Company. My initial target is $6 for next 12 month for a 20% pickup.

I also bid some PSP.V, a small company in the defense sector (timing was not very good though). While fully valued here, I think the growth potential of the company is certainly not priced in yet and if it could gets one of two contracts in the USA, it could really rock. I would be a bit cautious, given about 80% of its revenues are from Canadian government. My initial target is $1.5 and I would trim some if it hits.

I also added some WIN.TO, finally. I have been looking at this one since about $3.5 and failed to pull the trigger. I know there are a lot of institutional interests in this name, and I just want to take a ride here. I have a hard time to properly value this one, that's why I was hesitating all along.

Positions: Long: HIS.TO, PSP.V, WIN.TO

Week 7 - More or Less the Same

My portfolio is up a bit this week, bringing the short YTD results to 4.45% (vs. 3.85% last week). I continued to be rather passive, only sold one loser this week without any addition. I sold my entire position of ATA.to (Finally!!). The results were not good (as usual) and IPO of its solar division will be on the much lower end. This is one of the worst management team I have encourtered. No wonder they keep losing. An expensive lesson, never bet on impotent management! Healthcare, and gold seemed doing well this week, while everything else simply floating around, rather directionlessly.

CONSOLIDATION? - Week 6 Review

With Friday's selloff, I ended up this week flat. For year todate, I am up by approximately 3.8%.

I have to sold my entire position of EICU this week. While the Q4 results decent, it lowered its 2007 guidance from $0.3 to $0.27. With rather higher valuation as it is, this would not do. The stock has since fallen by approximately 15%. I still like the stock, but multiple has to contract further before I will be interested.

One of my tiny stocks, QST.V, which I bought at 24 cents in early December, went up dramatically this week, on a piece of positive news. When I first took the position, my target is 50 cents in three years. It went through it on a single day with tremendous volume. I was more than happy to feed into it a bit, and sold half my position. Now my cost is negative, I will hold the position and let it run. The jump may attract some attention from institutions, which would not be a bad thing at all.

I also took a small position in SVC.TO on Friday, a small technology play in network equipment. Timing may not be optimal though. There appears to be a lot of institutional interests, judging from volumes in the last few sessions. The company has some competitive advantages and a good market share position, although it is questionable how sustainable when CSCO is right behind it, with its vast resources. Target is $4.0 for the year, and I am willing to let it go a bit earlier.

My view of the market remains cautious, and I would view Friday's sell-off positive. A lot of momentum names have fallen hard (GOOG, AAPL, MA, NYX to name a few). But I believe we need a bit of more from here to make it more attractive. I have a list of names ready, and a fair good cash position. I'll say, "LET THE SELL-OFF BEGINS".

Positions: Long: SVC.TO, QST.V.

GOLDILOCKS

It's the end of week 5 and my portfolio, surprisingly, is up by 3.92%. This is rather shocking, particularly given that I have been rather under-invested for the first month of this year (holding close to a third in cash). When I go through screens lately, I am having a hard time to find stocks with a decent valuation. Despite the strong markets, I remain skeptical and sidelined. I will not chase this market here and I would rather sell or write cover-calls. Having said that I was opportunistic today and I added one gold name (ARU.V), as gold price fell more than $13 at lunch time. I got lucky as it bounced intraday low of $25.20 and went up, and closed at $27. The only minor mistake was that I could not quite decide how many shares to buy and I ended up with an in-between number. Oh, well, you can't be right all the time.

Position: Long ARU.V