I am very light stocks right now as you know. My 2008 stock predictions and ‘Fab 6′ have been mostly brutalized . Some good trading and general light allocation to stocks has kept me in the game. I was stopped out of Apple and Synaptics, but am back long some Apple. I also own, Chipotles, IBKR, Nuance, Gold, SLW and PAAs, OIH, PHO and some solar – FSLR, JASO, WFR and CSIQ. One of my 2008 predictions (the only one half right) was for a 50 plus percent wipeout in solar before the ramp continued. The 50 plus percent declines happened so maybe the ramp starts today.
I am barely watching the market and was emailed the First Solar sweetness from a reader the stock was up almost $60 to $230 (still $50 below all-time highs of a month ago). Too bad I sold the piece I was trading back at $195 (twittered that). I still own some from way back but am not excited enough yet to add any names.
If the little ones and First Solar can attack new highs I would truly be impressed and will likely add names.
I still think there is no reason to be farting around with stocks until we get a lot more leadership. I am farting around and have been mostly lucky on the trading side so far.
Difficult markets are where most investors get in and get screwed. Most of the time the market does nothing and you only need a few months a year of great leadership to make a killing. We just had three years straight and so you can’t be greedy. Don’t confuse inactivity though with bearishness. I am seeing some puked up awesome deals in local real estate and some new stock leadership in Biotech and Orthapedic stocks.
Stocks and private investment are just so different. In both, all I care about is price, but in stocks I don’t mind paying high prices and in privates I can’t stand paying high prices (I won’t).
Hoku Scientific (HOKU) has served up an extremely wild ride for investors, just recently poking it’s head above all-time highs near $15 and quicly falling back below $9.
They are in the ‘hip’ clean-tech space and work from the lovely state of Hawaii. I believe pineapples fuel their technology and pineapple prices have been flying. That could be the reason the stock has come down.
It could also be because we are in a bear market and the Company still has a $150 million market cap with $4 million in sales, but that’s just a guess .
By the way, I made up the pineapple stuff.
In crappy markets, ‘buzz’ won’t cut it…sales and margins do.
I said at the beginning of the year that solar and clean tech stocks would fall 50 percent at some point. They are getting their quickly. Those that have no business may not bounce back so fast if the overall market does not heat up quickly. If you must invest in solar, stick to the true leaders in this nasty decline.
HOUSING…All we are left with is another case study in fear greed and leverage. I started writing the case study back in February of 2007 (Wall Street set this case study in motion when housing stocks first broke out to new highs in 2002):
Homebuilders – The NEW Value Trap
Five years from now when the homebuilding stocks are 20-30 percent lower and marking time, small investors will all own shares in what the institutions have distributed to them since mid 2006.
The companies are not crap and they won’t be in 5 years, but the stocks will be value traps. Victims of a badly ended trend where the stocks were overowned and overhyped.
It is no one person’s fault, it is just the way Wall Street works. They are just not real growth stocks. Nothing was different this time and no particular CEO or management team will be totally immune.
The industry will continue to go out of favor with Mutual Funds. That does not mean you should sell your home or get bearish on the world. Hundreds of new trends have been emerging since the homebuilders peaked last spring.
Do not overthink it and get sucked into buying value. That’s for Warren Buffett and a select few, great value managers.
Housing stocks, not housing as a business in general are done. Housing is cyclical, always has been, always will be. You CAN overbuild, just like you can make too much capacity for semiconductors. With homebuilders, leverage sped things up. I disregarded my own analysis and in the Fall I bought the housing sector for a short-term bounce trade. That was my worst idea of the year. I quickly took my losses and have watching the mess once again from the sidelines.
I never tried to call a top in housing, but definitely warned that it would get worse after they had already fallen 50 percent back in February. I followed up repeatedly . I guess that’s why the permabears ‘disgust’ me so. As if calling a top makes you a special gifted market person.
I guess I was wrong about housing stocks being a value trap way back when . They never made it to value, just straight to bankruptcy.
Owning them now is not for anyone other than forensic accountants who have a crystal ball into The Fed and lenders tolerance or for penny stock speculators.
Jeff Matthews just just did a great look back at his housing call . Jeff is not scared of shorting on the way up. That’s why I would NEVER act on his posts. But, he has seen all the cycles. More than some 30 year old analyst writing 312 page missives on homebuilders or internet stocks. As I mentioned last week about the JP Morgan internet analyst – that’s a pathetic waste of time. We get to read Jeff’s missives for FREE. You just need to know ‘HOW’ to read them. Here is my fave and money part of the blog post:
I bought Time Magazine today for the first time since…probably since 9/11, when I bought every newspaper and magazine available with a cover story on the World Trade Center attacks. The relevance of a weekly “news magazine” these days is, after all, right up there with “Book-of-the-Month” clubs and the Sears Catalogue.
Nevertheless, I bought this new issue of Time Magazine because the front cover is titled “Home Sweet Home” (stamped in large letters, the “S” converted into a Dollar sign) with an illustration showing a man covetously hugging a house. The sub-title reads: “Why we’re going gaga over real estate.”
I bought it, quite simply, because this Time Magazine is as good a “cover story” kind of market-mania, surely-we-are-approaching-a-top indicator as I have ever seen.
If you had been excited Jeff’s great post in June of 2005 and sold all your housing stocks and even shorted, you would have been right, just a little early.
Both China and Solar are Case Studies in waiting. It’s the exact same. Wall Street is cooking up the supply. Timimg when it overtakes demand is a fool’s game, but it will happen. China is on the verge of another break, while Solar seems to be just getting legs. Both will end the same way, but you don’t need to predict when, just avoid being the YUTZ’s holding the shares once it is clear the trend has run it’s course.
Buy AKNS at $11.80 on market open. Sell AKNS at $14.80……..2 hours later? Book it Danno!
Hope you are on my Feedreader and caught the blog post and trade at the open.
Thank goodness for wifi and Interactive Brokers (IBKR – long). I just banged out half my AKNS for a $3 profit. I would have been happy with that profit over 12 months so I must book half. Sell when you can.
Eyeing my nemesis Starbucks down at $18 freaking dollars. What a stinker that I have stuck myself with. Starbucks needs a SOLAR coffee bean. ASAP.
Also eyeing Fedex (FDX) for my children down here at $86 and change. That has decimated investors of late.
I am being dragged back in to some new names. It’s silly, but price is price and strength is strength.
I am adding quarter positions in AKNS and CSUN. Both stocks should implode, but solar has exploded and these could continue. The stops are 20 percent plus away so adjust your size accordingly. They won’t make or break my year, but they are going on the sheets for now.
This is my first warning to ease off the pedal just a bit. I intend too.
I am tempted by the monsterous all-time highbreakouts in ESLR and CSUN today. I will stare for now and add them to my wish list based on their performance after the next crack.
This trend is in full gear. You have no supply (stocks) and improving economics. You have Venture Capitalists way behind and with money to burn. You are years away from the silly IPO’s…trust me they will come, to cure the supply problem. Most imporatnt, one mutual fund like Fidelity could own every share of every public solar stock and corner the market.
I don’t know what really happened today but wow. In frothy sectors sometimes stuff just goes up and up and you can’t explain it so why try. You can’t say I have not warned you, including this morning . Late in the day, my solar stocks rocketed led by CSIQ and FSLR.
I do know this. I am ADDING a few names asap.
Likely JASO – JA Solar Holdings . It just busted out again to all-time highs and looks too good to pass. Furthermore, it’s CHINA and SOLAR should go up doubly fast . They are so volatile that I am adding a 1/3 position only.
That will take my solar positions to four – FSLR, WFR, CSIQ and JASO. Frothy names for sure, but I have also sold down FSLR and CSIQ (blogged it ) so I have some room for a new position.
Is there an ETF yet? Bueller…Bueller
Other ideas welcome. Let’s make some money. It’s not too late, but there will be some horrific pullbacks along the way that make you barf.
The next 10 years will likely be more about energy and medical than straight tech. There is more at stake and these two sectors are behind on innovation. they take huge sums of money that Silicon Valley has in it’s coffers and can’t spend on the web.
This is the most interesting tidbit for you to remember:
Nanosolar’s founder and chief executive, Martin Roscheisen, claims to be the first solar panel manufacturer to be able to profitably sell solar panels for less than $1 a watt. That is the price at which solar energy becomes less expensive than coal.
“With a $1-per-watt panel,” he said, “it is possible to build $2-per-watt systems.”
According to the Energy Department, building a new coal plant costs about $2.1 a watt, plus the cost of fuel and emissions, he said.
This is the beginning, not the end of solar energy. Very exciting times. If you get mucked up focused on the averages and the financials, you will miss all the great new trends just beginning.
.
