Goodbye to Middleby and Rofin Sinar (MIDD, RSTI)
In the course of making decisions about which shares to release in order to reduce my margin exposure, I found myself thinking carefully about clearing out two small positions that have perfomed well for me over the past year or so -- Middleby and Rofin Sinar.
These two companies don't have that much in common -- they both actually create things, but for very different markets. Middleby is a commercial oven maker, and Rofin-Sinar a small diversified laser company. And while I like both companies, I don't like them enough.
I had earlier sold some of my Middleby shares when they reached a 100% profit, since I thought the unfettered optimism about the company was unlikely to last forever, and I had planned on holding these remaining shares indefinitely.
But I don't intend to add more to my MIDD position, and while I think they have a chance for steady long term growth I think there is certainly some execution risk as they continue to seek out more takeover candidates (even though their offer for Enodis was pulled). So it hardly seems worth holding on to what is now a very small position for me, on margin, in a company that I think is solid but unlikely to again exhibit the extraordinary growth that allowed it to advance by more than 400% in the last few years.
So with some regrets, I'm taking profits in Middleby and clearing the slate -- selling the balance of my Middleby shares today at $79 for a gain of about 70%.
Rofin Sinar is a company I've held for quite some time and am selling today at a decent profit -- earlier this year when I pared back my portfolio because it was simply too diversified, RSTI was one of the candidates I thought about selling. It made the cut then, but not this time.
I can't come up with anything terribly negative to say about the company -- in this case, it's really a matter of selling a company that is fairly difficult for me to analyze, and locking in a profit. I bought these shares after reading a compelling argument in an investment newsletter, but never got a good understanding of how they compare to their competitors in the marketplace, and never was tempted to build this holding into a full position.
It may be a mistake, but I'm just not that interested in RSTI anymore and, while not overpriced, it doesn't seem to be a tiny undiscovered value anymore -- so I'm selling my margined shares and taking a nice profit of a bit over 50%.
These two companies don't have that much in common -- they both actually create things, but for very different markets. Middleby is a commercial oven maker, and Rofin-Sinar a small diversified laser company. And while I like both companies, I don't like them enough.
I had earlier sold some of my Middleby shares when they reached a 100% profit, since I thought the unfettered optimism about the company was unlikely to last forever, and I had planned on holding these remaining shares indefinitely.
But I don't intend to add more to my MIDD position, and while I think they have a chance for steady long term growth I think there is certainly some execution risk as they continue to seek out more takeover candidates (even though their offer for Enodis was pulled). So it hardly seems worth holding on to what is now a very small position for me, on margin, in a company that I think is solid but unlikely to again exhibit the extraordinary growth that allowed it to advance by more than 400% in the last few years.
So with some regrets, I'm taking profits in Middleby and clearing the slate -- selling the balance of my Middleby shares today at $79 for a gain of about 70%.
Rofin Sinar is a company I've held for quite some time and am selling today at a decent profit -- earlier this year when I pared back my portfolio because it was simply too diversified, RSTI was one of the candidates I thought about selling. It made the cut then, but not this time.
I can't come up with anything terribly negative to say about the company -- in this case, it's really a matter of selling a company that is fairly difficult for me to analyze, and locking in a profit. I bought these shares after reading a compelling argument in an investment newsletter, but never got a good understanding of how they compare to their competitors in the marketplace, and never was tempted to build this holding into a full position.
It may be a mistake, but I'm just not that interested in RSTI anymore and, while not overpriced, it doesn't seem to be a tiny undiscovered value anymore -- so I'm selling my margined shares and taking a nice profit of a bit over 50%.
This article posted by One Guy @ 8/23/2006 12:01:00 PM 0 comments
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