The Wish List
Companies that I would like to own but don't, and why:
Citibank (C) -- seems like a terrific value, with great international exposure and a very solid payout. Hard to believe you can get a company this cheap with the level of growth they have and still get close to a 4% dividend. They aren't nearly as sensitive to increased interest rates or narrowing spreads as many other financials, so I think their stock is irrationally depressed. But I probably won't buy this one -- I like to leave most of the large-cap stock picking to the experts, since I don't think I can beat the market by buying big, well-followed companies the same way that I might by buying small caps, fast growers or misunderstood or irrationally mispriced companies. Bank of America comes close to Citibank in my book, too.
Costco Wholesale (COST) -- I love this business, and by all accounts the are some of the best merchandisers in the world. This is one of the few companies that beats the pants of Wal-Mart (Sam's Club will never have the success or cachet of Costco). Unfortunately, it's a little too steeply priced right now and while I'm sure they will continue to be successful I'm not convinced that the growth rate will make the current price a value going forward.
Motorola (MOT) -- I think their growth rate is going to surprise people, and that this company can get back to being an innovator with the next generation of cellular phones. The Razr proves that they have a good eye for design and for developing what people want, as they first showed with the breakthrough flip phones in the 90s. I think Motorola is getting unfairly tarnished for some management mistakes following the internet meltdown, and I think their focus on new phone design and partnerships going forward (will we really see an Ipod phone someday? If so, I think it'll come from Motorola) will put them in good stead. I like Nokia too, and think both of these companies have a chance to ride new designs to great success in the coming few years, but this is a similar situation to Citibank -- I'm trying to let Dodge & Cox manage the large cap portion of my portfolio since I don't think I can have much of a competitive advantage in that sector of the market.
Dampskibsselskabet Torm As (TRMD) -- This Danish shipping company was in my portfolio for a year or so, I sold my shares in December 2004 with a pretty substantial profit, but it has continued to go up. This is one I should have held long term, it is going to be much less boom and bust than the typical shipping company (and especially less so than the typical tanker company, which is a big portion of their business). They run tankers as well as other bulk ships, but their strength is in product tankers, not crude oil tankers, so they stand to benefit from worldwide shipment of other liquids -- from food products to refined fuels to chemicals, all of which are steadier than crude in my opinion, though crude tankers are still a great business if your stomach is strong enough. If the price drops by 20% or so, I'd like to buy back in, but I can't justify it at $50+. I'm holding out hope -- it's quite thinly traded on the Nasdaq and can be wildly irrationally priced at times, as it was when I first bought it at under $30 when, frankly, the business looked even better than it does today.
Affiliated Computer Services (ACS) -- I've been toying with buying this one for quite some time. I actually first heard about them as a municipal contractor for running red light and speeding cameras, which I think will turn out to be a huge growth business, but they are a very diversified computer services outsourcing company. I like the idea of it, and their growth looks pretty good to me and valuation seems fair -- but I must not understand the company well enough because the little voice in my head won't let me buy. After looking at this one on and off for nearly a year, I think it's going to take a sale price for me to buy in -- maybe I'll get lucky and they'll lose a high profile contract or report a bad quarter and I'll have another chance to take a close look and buy in.
Coffee Holding Company (JVA) -- This one hasn't been public for very long, but it looks very promising and I may well buy in once I have the opportunity to do some more research. They seem to be holding their cards pretty close to their vest, but the company sells coffee at wholesale both in their own brand names and to retailers to sell as store brands. I think this is a good business if they are indeed really capable of putting gourmet products out there at reduced prices, and building up their own brands, but I'm not convinced yet. I also don't understand the competition very well, or if they have an advantage in their relationships with producers or retailers or in the way they source, roast or package their coffees. Earnings look very good, so I think I'll let this one percolate and see how it looks once I've got more information on the business.
I'm sure there are more, those are just the ones that I keep coming back to recently -- I'll keep adding to this list as I remember or discover other candidates for the portfolio.
Companies that I would like to own but don't, and why:
Citibank (C) -- seems like a terrific value, with great international exposure and a very solid payout. Hard to believe you can get a company this cheap with the level of growth they have and still get close to a 4% dividend. They aren't nearly as sensitive to increased interest rates or narrowing spreads as many other financials, so I think their stock is irrationally depressed. But I probably won't buy this one -- I like to leave most of the large-cap stock picking to the experts, since I don't think I can beat the market by buying big, well-followed companies the same way that I might by buying small caps, fast growers or misunderstood or irrationally mispriced companies. Bank of America comes close to Citibank in my book, too.
Costco Wholesale (COST) -- I love this business, and by all accounts the are some of the best merchandisers in the world. This is one of the few companies that beats the pants of Wal-Mart (Sam's Club will never have the success or cachet of Costco). Unfortunately, it's a little too steeply priced right now and while I'm sure they will continue to be successful I'm not convinced that the growth rate will make the current price a value going forward.
Motorola (MOT) -- I think their growth rate is going to surprise people, and that this company can get back to being an innovator with the next generation of cellular phones. The Razr proves that they have a good eye for design and for developing what people want, as they first showed with the breakthrough flip phones in the 90s. I think Motorola is getting unfairly tarnished for some management mistakes following the internet meltdown, and I think their focus on new phone design and partnerships going forward (will we really see an Ipod phone someday? If so, I think it'll come from Motorola) will put them in good stead. I like Nokia too, and think both of these companies have a chance to ride new designs to great success in the coming few years, but this is a similar situation to Citibank -- I'm trying to let Dodge & Cox manage the large cap portion of my portfolio since I don't think I can have much of a competitive advantage in that sector of the market.
Dampskibsselskabet Torm As (TRMD) -- This Danish shipping company was in my portfolio for a year or so, I sold my shares in December 2004 with a pretty substantial profit, but it has continued to go up. This is one I should have held long term, it is going to be much less boom and bust than the typical shipping company (and especially less so than the typical tanker company, which is a big portion of their business). They run tankers as well as other bulk ships, but their strength is in product tankers, not crude oil tankers, so they stand to benefit from worldwide shipment of other liquids -- from food products to refined fuels to chemicals, all of which are steadier than crude in my opinion, though crude tankers are still a great business if your stomach is strong enough. If the price drops by 20% or so, I'd like to buy back in, but I can't justify it at $50+. I'm holding out hope -- it's quite thinly traded on the Nasdaq and can be wildly irrationally priced at times, as it was when I first bought it at under $30 when, frankly, the business looked even better than it does today.
Affiliated Computer Services (ACS) -- I've been toying with buying this one for quite some time. I actually first heard about them as a municipal contractor for running red light and speeding cameras, which I think will turn out to be a huge growth business, but they are a very diversified computer services outsourcing company. I like the idea of it, and their growth looks pretty good to me and valuation seems fair -- but I must not understand the company well enough because the little voice in my head won't let me buy. After looking at this one on and off for nearly a year, I think it's going to take a sale price for me to buy in -- maybe I'll get lucky and they'll lose a high profile contract or report a bad quarter and I'll have another chance to take a close look and buy in.
Coffee Holding Company (JVA) -- This one hasn't been public for very long, but it looks very promising and I may well buy in once I have the opportunity to do some more research. They seem to be holding their cards pretty close to their vest, but the company sells coffee at wholesale both in their own brand names and to retailers to sell as store brands. I think this is a good business if they are indeed really capable of putting gourmet products out there at reduced prices, and building up their own brands, but I'm not convinced yet. I also don't understand the competition very well, or if they have an advantage in their relationships with producers or retailers or in the way they source, roast or package their coffees. Earnings look very good, so I think I'll let this one percolate and see how it looks once I've got more information on the business.
I'm sure there are more, those are just the ones that I keep coming back to recently -- I'll keep adding to this list as I remember or discover other candidates for the portfolio.
This article posted by One Guy @ 7/16/2005 01:59:00 PM 1 comments
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