Recent Deals

Dear Diary,

I've been working a new job recently, and it's keeping my full focus.

I sold HRB on May 22, 2009 for $13.98 a share, a loss from the $15.85 a share purchase price on April 21, 2009, due to a projected narrowing in the Net Profit Margin in the "Value Line" presentation. The loss was minimal and is balanced out with gains in MDT.

PDCO was sold on May 30, 2009 for $20.68 a share, based on the same narrowing of the Net Profit Margin. The average purchase price had been $19.24 a share, making a slight gain on the deal.

SYK was also sold on May 30, 2009 on the same basis for $38.95 a share. Purchase had been for $33.22 a share, another slight gain.

Note how Holy Grail protects the investor from substantial loss, while making money more often than not.

On the Cash on Sale Arbitrage front, I took a substantial position in JAVA, due to be sold for all cash to ORCL on August 6, 2009. I bought in for $9.0477 a share and will let the deal close naturally at $9.50 a share, a 25% annualized gain.

Gene

Sold COH and HANS

Dear Diary,

I just sold all but one share of Coach (COH) at $23.99 a share, based on a Narrowing Net Profit Margin and project earnings for 2009 of $1.89 a share.

I sold out all but one share of Hansen Naturals for $43.86, based on the Holy Grail approach, as the stock now trades at 20 times projected earnings per share with a widening Net Profit Margin. My original purchase price was $35.97, far above what I should have paid last year, but the concept works out the same, just with less profit.

Gene

5-11-09

Dear Diary,

I just sold out all but one share of CROX at $2.83, based on a narrowing Net Profit Margin and Working Capital of $1.75 a share. My original average purchase price was $8.31 a share last year.

I also sold off all but one share of ICON, based on a narrowing Net Profit Margin at $14.99 a share. This was purchased for $11.74 a share on 4-21-09 a slight gain under the Holy Grail approach.

I sold off also all but one share of JSDA, based on a narrowing Net Profit Margin and Working Capital of $0.67 a share. The sale price was $1.08 a share, up from my original $0.81 a share purchase price.

With proceeds, I purchased CTDB at $0.135, based on Working Capital of $0.39 a share,
AGO at $13.60, based on Working Capital of $21.40 a share and VOXX at $5.04, based on Working Capital of $11.79 a share.

My overall activities are down only 8% against a Dow Average that is down 39% since the crash of 2008. I'm quite happy to be beating both the Dow and the S&P 500 in this market.

Gene

New Dynamics Explored

Dear Diary,

I just sold out all but one share of American Eagle Outfitters (AEO) at $15.54 a share, a loss of loss of $6.30 a share, as the Net Profit Margin is projected to narrow.

I also sold the Huntsman (HUN) position in total for $4.89 a share, a $0.21 a share gain. This was a Cash On Sale Arbitrage that I started last August 25, 2008. It was one of those 100% deals that fell through, discussed in "The New Buffettology," in the Arbitrage section.

I'm now buying several stocks based in their price being at a 50% or better discount to Working Capital. They were just bought as follows:

Symbol/ Buy$/ Working Capital

PKOH/ $4.09/ $22.99
ETFC/ $2.45/ $17.16
HDNG/ $4.57/ $13.23
PERY/ $7.11/ $15.08
MNTX/ $0.75/ $2.32
CCIX/ $2.53/ $6.92
SBSA/ $0.18/ $0.66
ROX/ $0.22/ $1.19

I have a few more stock to buy under this arrangement, but my portfolio looks very good.

Gene

4-21-09

Dear Diary,

I sold my position in Waters Corp. (WAT) at $36.48 a share, a $0.78 a share gain, noting the projected Net Profit Margin is now in decline.

I also sold almost all of my Southeby's (BID) position on the same basis. The sale price was $9.60 a share, a $0.59 a share loss.

The proceeds were used to buy up the average purchase price of my H & R Block position from $15.85 to $16.16 a share, based on a widening Net Profit Margin and a P/E Ratio below 10.

I'm down 19% from 2007, while the Dow Jones Average is down about 42%. This is pretty good news, as Ben Graham, Warren Buffett's teacher, spent seven years in negative territory through the Great Depression.

It appears that the bottom has been found in this recession around 6,500 in the DOW, as I'm seeing all my stocks drift upward the past few days. I'm going to do some changes in strategy tomorrow, I think, to maximize some purchases. I'm very happy with the way my investments have gone the past 1.5 years, relative to the market.


Gene

Still Buying

Dear Diary,

I just bought shares of H&R Block (HRB) due to a Holy Grail dynamic; however, it does carry some long term debt. My buy price was $15.85 a share.

Also, I just bought shares of Iconix Brands (ICON), a brand owner of some high profile clothing lines. The buy price was $11.74.

My portfolio has been on the rise in recent weeks. Holy Grail is holding its own against Buffett-Graham Net Quick Asset Deals so far.

Gene

Buying MDT

Dear Diary,

I just bought more Medtronic, Inc. (MDT) for $30.99 a share, bringing my average purchase price down from $36.86 a share to $35.01, based on projected earning per share for 2009 of $3.20 and a widening Net Profit Margin.

Gene