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Stock Pick Follow Ups

by SMD 


I’ve wanted to follow up on the three stock picks that I have made on this site.

#1. Let’s start with the biggest blunder. On March 22, 2005, I ran ”Why I would Short Google Immediately” At the time GOOG was trading for $188 a share and had a P/E of 123.

Now? Despite falling 3.5 today it sits at a cool $274 a share with a P/E of 108, which means that earning have accelerated faster than the share price which is up 46% in ~ 3 months!

Ouch, I would have gotten hosed on that short [I didn't actually sell it short]. Actually I wouldn’t have because if there is one thing I have learned in the stock market, it is the exit strategy. Draw a line and stick to it. Don’t talk yourself out of your line. Cut your losses and live another day. Usually 8% loss and I’m out, if it rockets up the day after, oh well, I still remember the ones that fell to pennies from $40 and I told myself it’s only “temporary weakness” all the way down.

If the laws of gravity are still in effect, Google has to come to earth eventually, but they sure have a great run going.

#2. On May 2, 2005, I wrote about VSM.TO which at the time was at .46. Currently it is sitting at .89, which is a pretty cool 93% return in a month and a half. Sadly, I passed on this one as well. I actually knew the former CEO of this company and it was at .73 a few years ago when he took over. It went to $8 before he got bit by scandal and was shown the door. I missed that party too.

#2. On May 4, 2005, I wrote about another company that was trading below its book value. This one was Laurentian Bank – LB.TO. Then $27.00 and now about 27.40. Well you can see where my head is at for the stock market right now. I’m spending all my time working on the internet businesses so I like low maintenance stocks. LB also pays a 4.5% dividend and I hold it in my retirement account…geez I’m sounding more and more like a middle aged married guy.

Okay, off to take the Ford Taurus to pick up the 2.4 kids at soccer practice. I can’t believe I’ve become a bank stock buyer.

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