Be careful with gurus dispensing strong recos on bazurs.... they might just want to get out

We feel an affinity with a certain thinker because we agree with him; or because he shows us what we were already thinking; or because he shows us in a more articulate form what we were already thinking; or because he shows us what we were on the point of thinking; or what we would have thought much later if we hadn't read it now; or what we would have been likely to think but never would have thought if we hadn't read it now; or what we would have liked to think but never would have thought if we hadn't read it now. 

Affinity by Lydia Davis

Be careful. Im seeing so-called Gurus in forums again recommending strongly either bazurs or stocks (like the Lopez-owned, BHI, SMC, LC) that have underperformed others during the bull of Jan - June and tumbled down more than the PSEi average from Jul - September. Most of these issues went down for valid reasons (no growth in earnings, plant facilities combusting, too much debt, regulatory problems etc), the least that these gurus should be including in their recos are these negative things that are still hanging like a sword on the head of these companies. But they don't.

Why do these active forum users are all hyperbole on these stocks then? They probably have big positions bought near the top of these stocks, the classic ipit position, and are wanting to get out to have some cash to prepare for the almost-sure surge of Dec - Mar.

Beware of these people. They are expert re-shaper or omitter of facts to get your affinity.

Although small, I still have minus-15% ipits in stocks like ROCK, SGI, and GERI (because I elected not to cut loss and cut clean (100% of holdings) here when I had the chance). I have even averaged down on them recently, but Im not pushing these as pick of the weeks bluntly without warnings. Im ready to just dispose them in full during strong rallies, if I see that others like AGI deserve my cash more.

If you are attracted by strong cheering, the least that you can do is read up on fundamentals or back read on the forum thread of the particular stock and check for the reason why it fell down hard. At least you know the risks youre going in to.

There are even the worse guru who's dispensing advise left and right but have no skin (no money) on the line. They are like trolls pretending to be experts, being entertained by fools, or enjoying the fact that people follow their instructions to go into dangerous positions, but have no bet of their own.

Then there are also those devils that are on the sidelines watching for short-term gain, and will get out as quick as they get in. They will sell their, say, 500 K PhP out from BHI the moment that they see that their stupid no-sound-basis hyping gave them +1% already in one day. They are just out to get pizza or grocery money. Do not be their donor. 

Late Pick of the Week: Look for higher lows in JGS, MBT, MEG, but if you're eager to position now, choose TEL

I knew I have time to monitor the market this week; there is valuable time to spend to hunt for short terms gains, so I disposed some green in MBT, MEG, AGI, and AEV to raise cash. I expect that sentiments of some locals will be to dispose at our current 6600 levels. Some of our countrymen who were jittered before are probably exiting at near breakeven, so it's time to dispose some green and wait for them to dip again by at least 3%--better at minus 5%--to re-take similar position size.

For example, I disposed a huge chunk of MEG at 3.91, the moment that I saw that 1) the stock is already oversold, and 2) it's too weak to even break 3.95. And so, 3.91 less 5% is 3.71. Im waiting since then to enter some at 3.71, add another position at 3.70, and then a huge buy position at 3.68. I still haven't been blessed with shares at these levels, but am waiting. If MEG continued strongly at this very high RSI. I still have 20% of my original position. I just have to live with my bet that it's more probable for MEG to cool off a bit and be below oversold levels.  

Same applies with AEV, AGI, and MBT... I disposed all or huge chunks of these stocks, and now Im waiting for their higher lows to materialize before getting in again (first reentry at -3%, ideal at -5%).

But since I wanted to take some new positions and not be holding too much cash, I took positions in TEL and DMPL as well. I think TEL is undervalued at this time, and will perform some +5% in short term. Why? 

1) its forward P/E is 16, while its only competitor GLO is trading at 23 - 30 P/E. I know that the Ayala's enjoy some premium over competitors because of their perceived better managers, but that disprity is just too much. 

2) the BPO industry is experiencing tremendous growth and TEL should be one of the main beneficiaries  

3) PLDT's DSL is way faster than those stupid Tattoos and mobile broadband scams.
4) If youre caught ipit even at -10%, there's still some margin of safety. TEL always pay hefty divs to make up for it.

DMPL I placed a small position in because 1) its current price is below its current at SGX, 2) I feel that the market hasnt fully taken in the impact of the acquisition of the US Del Monte business. This makes for some good reading regarding DMPL:

http://research.maybank-ib.com/pdf/document/Del_Monte_141013c_5174.pdf

Besides that, Christmas is nearing. We're approaching that time for Buko and Fruit Salads. That would have some Del Monte Fruit Cocktails by default.

Again, these picks of the week have time frame of at least four weeks. It's time to revise your portfolios for intermediate and long term and prepare for the surge until March.

6800 in 2 weeks, choosing index stocks.

My bet is that we'll be at 6800 again 2 weeks. After reaching that level, some that has been caught holding the bag there last June-July will opt to exit. We also might be at overbought levels by that time, so it's more probable to have some correction by then.

This is +3% from where we are now and some index stocks will of course rise more than others. Which PSEi component to ride hoping it will be the leader?

FGEN is one of the most touted (strong buys) by local brokers, presumably because it is 50% away from its highs during June. I added minimum tranche last Friday on my small remaining position just to average down, but I dont have strong conviction that this is on the uptrend already. They must disclose clear plans with target completion dates on when two downed major revenue-producing plant sites will be up again. EDC is also always on the recommended-buy list with FGEN... same need for disclosure/news. These Lopez companies should choose the path of transparency.

SMC has gone up because of their property dividend, but I still down trust The Mechanic and most of the management of San Miguel, specially in terms of how they think about us small-time retail investors.

Favorites JGS, GTCAP, and SCC Ive divested wrongly since they went up strong since I sold them, but my unloading was a decision to have some protection in case the US indeed defaulted. That was the call. Im ready to go back to any three especially if one exhibited a cup with handle.

LTG has been going down. Might be good to buy at 15, but this is one index stock that is not for long term. I also dont trust Lucio's managers.

I still have AGI. I hope to sell all when it nears resistance again at 28.

Although Ive unloaded much already, I still have substantial positions in MEG and MBT. Will sell again once they reach oversold in RSI.

PX--Gold is still volatile. Out with Mining muna siguro.

BLOOM is not attractive to me at current levels. The disclosure on change-operators is also a bit problematic in terms of long-term investors that want stability.

I still don't understand why the Gokongweis were not obliged to disclose their buying price of MER. I wont get into MER again until there's clarity with that.

Still have substantial positions in AEV and AP and intending to hold until Q1 2014. Both are heavy-dividend paying stocks; these should be two that jump in price as we enter 2014.

ICT, GLO, and JFC I consider as missed boats already. Im not a fan of buying high and selling higher for these three, since they have very P/E's at this time. (But I have long-term shares in JFC in certificates).

PCOR I havent studied yet.

MPI--Im inquiring about time frame on the arbitration regarding the water rebasing issue, before getting in again.

MWC I still have an ipit position. Ive added one tranche last week to lower down average. It's too late for me to sell at -20%.

I profitably played (a number of small gains) with DMC during its up and down the past three months. I knew that the Consunjis defend this stock when it's going down to sub 45.  I have some small long-term position in green that will wait until their next dividend announcement next year.

I have no ALI and do not intend to go in at current price above 30.

I have some position in RLC that Im just leaving until March 2014.

Although I profited several times with URC during its ups and down July to September, this stock is still a puzzle. The main question to answer is if it can go back to a steady uptrend. I have no current position and I intend to study URC more.

I entered TEL last week. More on my presumed current state of TEL in another post.

I also entered SMPH with small-tranche last week. I think there's a good chance it can go up to 19.50 at least in the next four weeks. Will observe this closely together with SM (if it can go back to 900 levels before the year ends), but I dont like SM going back to above 26 P/E too fast.

AC is a known favorite by foreigners and always enjoy a higher premium P/E vs. its nearest competitor, which is SM. If I decide to go in, it will be small and something that I will sell fast at 660 or so.

I still hold some position BDO in green. I will sell if it reaches +10% gain.

I sold all my BPI at a small gain before the deadline and threat of default by the US. I wont probably go back at current level of BPI. Potential upside might be greater elsewhere (including non-index pets).

These are all superficial gloss-overs. Best to research way deeper on your own before going in. My only firm suggestion is to not skip the local non-favorites in your study. From participating in forums, I think GTCAP, JGS, SCC, AP, and RLC do not get much attention, and this is undeserved. They might not be apples of the eye and dont get mentions in forums, but they are all very attractive fundamentally, being traded at high volume by foreign and domestic funds, and are not yet expensive in their current valuations. Their recovery and increases at this point are in fact steadier and higher than other index components.

Friday moves

US Politicians eventually agreed to end the shutdown, we hope that focus will be now again on company earnings, growth, and macroeconomic merits. But another FED meeting is upcoming end of October. Will they choose to ease up on the bond buying?  Jobless claims though increased because of the shutdown. Will this be considered by Bernanke and group? Or the semi-experimental printing of money just had to be going on of too long and had to be lessened?

SMC announced property divs at a value seemingly at +10% yield against its current price . The stock increased just +5% though with foreigners exiting. I wont go back to SMC at this time; better to see robust earnings rather than this divs, which can just be an attempt to list-by-introduction Top Frontier Holdings and have a couple of major holders exit, more than any thing.

Gold increased substantially last night. Im adding LC at opening.

BEL and MCP might be going down. This and other stocks listed in the previous post are on my watchlist. Im getting in if they get to my desired prices.

Default and perish?

Yes. It's somewhat frustrating to realize that the performance of our market is not anchored on local company's earnings, our own domestic news, or our stellar GDP growth. Instead, we're all anticipating how a group of grownups, several thousand miles away from us, will eventually get their act together.

Anyway the news now is that the Republican leadership is trying to leash-in its hard-core conservative tea party hardliners. It appears that these congressmen are bent on creating chaos from the very start, and Boehner has to get them in order.

Well, we small players have no choice but to ready some defense. Today was a good day essentially. I sold all of my BPI, some MBT, some MEG, all of GTCAP at gains, however small. Was able to raise cash to 40% in my BPI port and 20% in my FMS port. Either the foreigners who bought up today's market allowed us some elbow-room budget for averaging down, or some fund managers are confident themselves that a deal will be closed in the next 48 hours.

The answer may not be available until Friday morning, but we should be ready even at opening tomorrow. Make sure to open your favorite news site before PSE opens.

Pick of the week: none. Wait out until Oct 17.

It's too risky to buy today. Keep cash handy, instead. The Republicans may really try to test and rough it out on to a credit default, regardless of the multitude of financial experts who are warning about the catastrophe that will result from it.

My minimum cash position in uncertain times like now, as mentioned many times before, is 30% of total current balance (capital + all gains).

Ive sold remaining shares (a significant chunk) of JGS (in green) to raise money in my FMS port; while cash remains at 30-40% in my BPI port.

Ive added one tranch of TA though (banking on the good news and additional revenue that the activation of Maibara power plant brings), and placed buy points in TEL beginning at 2830.

Ive also played with DMPL earlier--bought and sold within two hours, for a small 700 PhP gain. I think the buying of Del Monte Foods US is a big deal that market hasn't gauged positively enough (yet), also because of the possible impending default.

Other than small plays like these, I'll just be on watch mode for the next 3 days.

Another Storm Looming?

As Im writing this, the headlines are not good:

http://www.bloomberg.com/news/2013-10-13/effort-shifts-to-senate-leaders-to-resolve-fiscal-impasse.html

Have sufficient cash as always.

Contemplating for the next 4 weeks

After two weeks, got to assess positions only now.

The last two weeks have been good. Might have sold too early some partial tranches in JGS and MEG, but I still have substantial position in both in my other port. Only the cut loss of MER seem as the one mistake. Cash position increased to 45% when my sell points in ANS was hit. I averaged up in MBT and added some in FDC and AEV last Friday to return to 30-35% range.

Also in my other port, a minor blunder was in playing, although small, with LC, but Im still holding that. 0.4 seems to be a very strong support for this once-index component.

Im now looking at the following:

• BEL and MCP seem to be amping up in the press its strength with having the Hos as operators, and their existing junket system with high rollers, as predicted. I sold all my BEL with a small gain at 5.1 two weeks ago. If this breaks 5.4, Im getting in again.

• TA seems ready to go up again to 5.4 (minimum), but I have already a substantial existing position. wont be adding more.
• DNL seems eager to return as well to 7+, but I hope to see more volume.
• Im looking for some possible cup and handle formation (I believe in this Technical Analysis pattern, if only because it seems to be based on probable human psychology especially apt for after a downturn. If you dont know the pattern yet, best to google about it and read).

• The main Sy stocks--SM and SMPH--might fit this pattern before going back to their high June prices. 
• JGS might also exhibit cup-and-handle before going back to 45+. The IPO of Robinson's retail might also bring some influence to prod it to breach 50+, but I'll be contented to start selling at 45 - 48. 

• TEL appears wanting to go down next week. I'll be buying starting at 2830 again if it reaches that level.  
• Properties appear ready to go up in unison. Have to have in watchlist VLL, ELI, GERI, ROCK, and CPG. These companies have good income growth this year, and they are far away from their 52-week high. I'll probably buy into the one that show good strength on Monday, but among them VLL might only be the one for long term.  

Will make my pick of the week on Monday among these mentioned stocks. And that pick's hold time frame will be for minimum within four weeks. 

Mamingwit sa ilalim vs. maghintay ng breakout

Totoo namang mas delikado mamingwit at manghula na pinakailalim na ang mapupulutan mo, kaysa maghintay na lamang ng breakout tsaka makisakay. Sa pangalawang istayl ng trading, mas may istruktura ang mga gabay. Meron kasing mas mahigpit na paalala na kitilin ang pagkatalo kapag hindi nagtuluy-tuloy ang breakout tulad nang inaasahan. Sa halimbawa ng PGOLD (na isa kong perinyal na paborito pero di na nasubaybayan)--

Bagamat hindi mataas ang bolyum kumpara sa gusto ng mga tagahanap ng lehitimong breakout, nilampasan ni PGOLD ang 42 na ilambeses nyang sinubukang basagin bago pumailanlang na ngayon. Kung bumili ka sa 42.1 noong 10/02, mayroon ka na ngayong mga 8%. Kung kasama naman sa mga natakot noong Miyerkules at nagbenta sa 45, oks na rin ang +7%.

Paalala ng mga tagasunod ng sistema na ito na magkitil ng talo sa pinakamalapit na support kung peke pala ang breakout. Sa kaso ng PGOLD, sa 40 o 38 mag-cutloss.

'Malinis' ang istayl na ito, subalit mas eksayting ika nga ang sumubok mamingwit sa ilalim. Tulad ng totoong isport sa fishing, napakasaya (tingin mo'y napakagaling mo) kapag tama ang hula na ilalim na talaga ang napagbingwitan.

Ang karaniwang guide ng mga mangingisda sa ganitong istayl ay ang RSI. Kapag sumasadsad sa 30 ang RSI, pero solido naman ang kita at kinabukasan ng kumpanya, dapat daw mamingwit na. Sa kaso ng SECB na dinispatsa ng mga pondo dahil sa mababang ulat ng kita noong nakaraang quarter--

--kung bumili ka sa dulong 105, meron ka nang 30%+ ngayon. O kung sa saktong 30 RSI bumili  (mga 118 ang presyo dito), 16% pa rin ang kita. Mas mataba nga ang ganansya at para kang henyo o pinagpala ng maykapal kapag bumili sa isang mababang presyo at biglang tumaas agad mula doon.
Subalit napakahirap nga namang alamin kung talagang dulong ibaba na ang mabibingwitan. Pano kung sumadsad pa sa nuwebe halimbawa ang RSI?

Ang sagot siguro ay, kahit anong sistema man yan, kailangang ang fundamentals pa rin ng kumpanya ang saligan. Tuluy-tuloy pa rin naman ang kita ng SECB at makikita naman sa paligid ang patuloy na pagsulpot ng mga branches ng bangkong ito (nag-eexpand ang negosyo), kaya siguro marami ring pumasok at sumuporta sa bandang 105-110.

Ganon din sa mga sumabak sa GTCAP. Di na kailangang hintayin pa na umabot sa 30 ang RSI sa kumpanyang ito ng mga Ty, solido naman kasi ang Toyota, Metrobank, at Insurance na pag-mamay-ari nito, at pag tinignan ang graph, parang malaki na ang probabilidad na tumalbog sa 750 ang presyo dahil ilambeses nya na ginawa ito noon.

Ang problema nga lamang kapag may matinding bad news sa bansa o sa merkado (tulad ng QE easing), maaaring lumagpak pa sya ng husto. Sa kaso ng GTCAP, umabot pa sa 700 ang lagpak (maiging dagdag na lang siguro pag abot doon).

Alin sa dalawa ngayon ang mas mabisa? Walang aksyon masyado pag hintay lang nang hintay ng breakout. Madalas lang ang kasong ito kapag 'overall uptrend' ang merkado. Kapag ganoon, hindi na nga kailangan maghintay ng breakout, dahil lahat halos (lalo ang mga magagaganda ang paglago ng kita) ay tataas. Kung aksyon ang gusto, ang mamingwit sa inaakalang dulong-ilalim ang magagamit. Ganoon din kapag di kalakihan ang itataya.

Kabaligtaran naman ang sa mamingwit sa ilalim. Bihira naman ito kapag tumataas ang merkado sa pangkalahatan. Madalas, ang mga bumabagsak ay ang biglaang bad news sa pang-araw-araw (halimbawa, ang biglaang paghahabla ng smuggling ka PNX).

Pero pwede namang gamitin pareho. Tandaan lamang marahil na ang fundamentals pa rin ng kumpanya ang dapat saligan. Ang PGOLD ay patuloy naman ang paglaki. Dito rin kami nag-go-groceries ng pamilya. At dapat walang malaking bad news ang kumpanya. Halimbawa ang MPI at MWC sa ngayon--dahil sa order ng MWSS na magbaba ng singil, di pa solido ang sitwasyon nila para hulaang mamingwit sa ilalim. Kasama na ang mga minahan na napakalikot ng presyo at wala pang liwanag ang kinabukasan hanggang di naaayos ang batas sa pagmimina sa Pilipinas.

Alin ang magandang abangan ang breakout sa ngayon? GLO siguro, subalit di ganon kalakas ang paglago ng negosyong ito kumpara sa PGOLD. Pwede rin ang ICT? JFC? DMPL?

Alin naman ang magandang abangan sa baba? VLL sa 5-5.05, AP sa 30 - 31, AEV sa ... magbasa ng forum tulad ng SMP para makasamang mamingwit. Madalas may isang pondo lang na piniling idispatsa ang stock, kaya nagiging parang bargain ito panandalian. Ang sarap talaga kapag nakatyempo ng ganire.

Thank you, MEG and JGS!

Writing a short post just to gloat about these two picks that were on point and jumped within the 30-day period that Ive set.

Ive sold some MEG at 3.65 as previously decided, and some JGS at 42. Im still holding a substantial half of each though, given that they are still showing strength. Ive set next sell points for MEG at 3.79 and 3.89; while none yet for the remaining JGS, since this conglomerate is releasing good news left and right and peso appears strengthening (they will declare forex gains if peso comes back to 40 PhP).

There was also some hefty gain from ANS, which I sold at 6.89, 6.99 and 7.1. I wish I could have added more when it was hovering at 6.5, and many of us in SMP was almost 100% sure that it is going to announce a hefty devs, but it was the low volume trading that held me off. In any case, it was a good ~ 8% average gain.  Thank you, too, Andres. (Lorna Kapunan, abandon Napoles please).

Only FDC and LC appear to be failed (minor and speculative) picks. Im still holding two tranches of LC at -6% loss (Im ready to cut loss here at -15%, but it never reached that yet). I added one tranche of FDC at 4 (buy was set last night). I believe it should go up given that subsidiary FLI is going up.

Week 41 was a good week, while Im mostly out and cant follow the action.

Still have no time to research for a good pick. Will do that again on Sunday.

O-ha, Meg!

Tamang-tama ang pasok ko sa 3.33 at otomatik benta (iniwan lang ang gustong presyo) kanina sa 3.56.

Ayos na sa akin ang 7.5% na ganansya.

FDC na ngayon ang aking susubaybayan. Bili na ko konti sa kwatro. Naalala ko rin kasi ang kwatro o kwarto na tsismis noon sa unibersidad.

Heniwey, ambaba pa rin ng bolyum dahil nag-uumpugan pa rin ng bayag si Boehner at Obama. Wag kang magbibigay ng bayag, Obama. Oks lang na malugi kami konti o maghintay konti. Ipaglaban mo ang Obamacare. Pag bumigay ka sa mga kongresistang iyan ngayon, kakayan-kayanin ka na nyang mga yan hanggang sa magtapos ang termino mo. Baka di pa manalo si Hillary nyaan kapag di nangmatigas kayong mga Democrat.

Kami rito'y titingin-tingin muna ng bargain. Biruin mong 8 na lang pala ang P/E nga ng FDC, e dividend paying naman yaan.

Pinoystockpicker Turmukesh is on days of teambuilding, then vacation, then planning session

I get to squeeze in time for the PSE at night only.

Will be back on Sunday, October 13.

Walang gano inimpak si Moody's?

Huminto na si pag-iinarte si Moody's. 

Pero walang hiya talaga itong si Boehner at ang gang nya. Porket ayaw nila ng batas na pumasa na, bubulabugin ang buong mundo. Hindi rumerespeto sa consensus ang mga ito. Napakalakas sana ng pagtaas ng stocks natin dahil kay Moody's, pero kakarampot lang ang nangyari dahils sa tirada nia Boehner. Mukhang sugal pa rin ngayon tuloy ang mangyayari.

Subalit mukhang mas pabor na tumaya kaysa manood lang. Pumili na lamang ng solidong kumpaya na pwedeng pagkaipitan kung aabot doon. Wala na munang BHI at LC.

Papasok ako sa MEG sa 3.33 at BDO sa 86. Yan lang, dahil hindi pa rin sigurado ang kalalagyan ng ating merkado.

Late Pick of the Week for Week 40: still MEG and watch the banks, especially MBT and BDO

Was out on several days for a teambuilding, was not able to actively participate in the market, was not able to make a pick of the week. And I became aware just now that finally the long-awaited Moody's upgrade was announced! But was also surprised that the increase after the lunchtime press release is just a measly +0.4%, and that the foreigners are still net sellers at this time. These facts, in combo, are surprising indeed.

It seems that the standoff between the Lower House and White House in the US bears more impact to us more than any good news. And October 17 seems to be the critical date to watch. This is the day when the US begins to default on some payables, if they dont get their act together. Imagine the gravity of this 'milestone' if ever it happens.

Since I will also be out tomorrow afternoon until Thursday (I dont know if James can post), and the only solution in my case is to be cautious. I'll still maintain my cash position, probably at minimum 25%, and will only place bets on MEG (which appears to be on the path of improvement again). I will also add a bit to existing green position MBT, which went down from 91 to 84, despite Moody's and other analysts singling out the strength of the bank and its current cheap valuation. BDO closed at a thick bid volume, this is almost guaranteed to be green tomorrow.

Others are recommending releasing all cash--If you do this, it will be a bet on the one good news. It's sound to do if you have time to follow price movement, so you will get have a better chance to make the right decision--whether it's time to cut loss or take profit. It's in knowing when either decision is needed.

***

I dont have time to fully research VLL, JGS, GTCAP, AGI, and other 'solid' non-bazur favorites of recent weeks. But if the Moody's upgrade 'overpowers' negative sentiment, they should be among the stocks that join the upward trend.

Include AC in this fray. It is almost assured to go back to 650 level if market really begins to go upward because of Moody's.

Good luck!