What I'm buying today - A cherry picking, market timing thread

How about a thread for cherry picking ?

I’m buying AIMT today. I have had a position for a long time and I’m down 30%. They have the only peanut allergy approved treatment and good news on Friday re. efficacy. On a normal market it would be up 40% but it’s down 11% pre-open . I’ll be adding to my position today

I’m looking to buy more NOW, open a position in EVER and maybe VG. That’s part of my crash list.

Maybe ZYXI today.

Walter

I would like to buy UNIBAIL-RODAMCO-WESTFIELD (URW). But my IB account does not allow it.
https://www.marketscreener.com/UNIBAIL-RODAMCO-WESTFIELD-43851519/

Unibail-Rodamco-Westfield (comprising Unibail-Rodamco-Westfield SE and WFD Unibail-Rodamco N.V.) is a world leader in commercial real estate. At the end of 2019, the real estate portfolio is valued, in gross market value, at EUR 65.3 billion.

Today stock is down almost 20% at €58.18.
Dividend:
An interim dividend of €5.40 per share on March 26, 2020 (ex-dividend date March 24, 2020); and
Subject to approval of the URW SE AGM, a final dividend of €5.40 per share on July 6, 2020 (ex-dividend date July 2, 2020).

So dividend yield is 18.6%

I built a few screens for this… here’s one (attached):

It buys strong financials / quality companies – it’s done 20% / year in backtests with 1 year holds. I will be dipping into these companies over next 30-90 days.

I bought Sprouts and Kroger this morning. Two US grocery stores that had been hammered down. Seems like they have very strong sales (been in their stores out here) – and market seems to agree some right now.



Humana is also interesting right now.

mmmmh. I agree it is tempting, but deleveraging is probably not over and covid peak (and likely also peak of fear) is expected in about 1.5 to 2 months (“best bad case” scenario, meaning no treatment but Covid follows a normal flu outbreak model).

Using Pr2Sales as a sentiment gauge, HUM is being repriced to close to its 3 year ratio low. If you think that sales will decline, too, make additional downward adjustments.

Walter


agree it’s too early to buy… but dollar cost averaging in may make sense.

Not sure it makes sense to hold TLT anymore, does it?

On a top-down basis, I’m looking at REITs. The sector outperformed powerfully for a while but is getting hit very hard in this crash. But the sector’s balance sheets are better than they’ve been. VNQ is the sPY of REITs, that passive go-to thing for one who wants to commit money now and analyze (and reallocate) later. I’ll probably add to a position here. Housing REITs are my top choice now; APTS, BRG and SUI. There will likely be some rent payments missed by folks who lose income during this mess, but they aren’t going away.

Separately, Marco’s AIMT idea looks interesting. I’ll check it out.

HUM is a good thing to be thinking about, but I don’t have a deep feel for players in healthcare, so I’ver been nibbling at some of the major ETFs — again, a buy first-analyze later approach. Zero commission makes for interesting possibiities.

REIT’s are interesting, but if this turns into prolonged recession – REIT’s typically get killed.

The healthcare side of REIT’s may be interesting. Something like Omega Healthcare investors looks interesting.



Something like this could work:
https://www.janushenderson.com/en-us/advisor/product/old-the-long-term-care-etf/

But AUM is too small.

Buying some of these could work:


Screen Shot 2020-03-16 at 12.30.29 PM.png

In this day and age, the word “typical” has no meaning. (Note, too, that in a “prolonged” recession, EVERYTHING gets killed — defensive equities aren’t like what they used to be). And I’m getting a bit less worried about a prolonged recession since Congress and the Administration look like they’ve rediscovered the long lost art of fiscal policy. Seems even Republicans figured out that it’s better to prime the pump rather than watch incomes of the voters in their districts/states go to zero for a prolonged time.)

Retail REITS are in deep doo-doo and that’s been the worst-kept secret on Wall Street for a while now. (One of my best positions lately has been an ETF that goes long e-commerce and shorts brick-amnd-mortar.) Hotel REITS are especially getting hammered by social distancing — the extent of comeback is case by case likely relating to how tied they are to communication tech that makes business travel less compelling than in the past. Former-mall-turned-entrtainment-venue REITs are getting hammered by social distancing, but they can come back. Data center REITs have good prospects. Housing REITs as well. Medical tool. There are also industrial REITs, storage REITs, etc. Mortgage REITs have long been a volatile area but lately, most on the street, including data vendors, have been pulling them out of the REIT category altogether since they operate more like banks.

In any case, whether one is bullish or bearish, this is a time for analysis, not platitudes.

I should also mention, though, that one really ought to teach one’s self how to go through REIT financials; typical web presentations don’t work.

In fact, it’s a good idea for anything to learn to love 10-Ks and Qs. (For example, on Marco’s peanut-allergy idea . . . I see the business side, but there is a cash-burn issue that needs to be considered, although once distribution of the new drug gets going (interrupted now due to covid-19), the street’s excitement over the drug may offset the usual hand-wringing about dilution from outside capital they’ll need to raise. Thinking . . . .)

I’m just saying I would zero in on healthcare reits first – a lot of them will likely have rising revenues if this is bad – so, stay financially strong. And should be okay if this is short-lived also. Relatively speaking.

Residential and apt reits more subject to lost income by real workers and real sales / income losses and downgrades. People are already being laid off in restaurant and hospitality industries… so, seems like healthcare reits have the ‘real estate piece’ – but also a prospect for rising income / revenues.

The same thing with the grocery stores – they got hammered in first selling wave, but they will see / are seeing income rising and profitability rising. Without real supply chain disruption, they will see revenues grow as people eat out less, and buy more for in home consumption.

From Tom’s post, I put ADUS on my short list.

Marc,

where would we find good education materials on REITs that would allow to leverage what we can do with P123 e.g. automation etc (as opposed to or as a complement to reading 10-Ks)

Thank you,

Jerome

NB: I know there are a couple of useful blog posts from you e.g.

or Screening to Shield REIT Yield Hogs from the Butcher’s Knife – Acti-quant

Agree adus is interesting. Tons of cash, strong financial strength. Good sector. Not super cheap yet, but strong revenue growth and good financial position, and some ability to whether storm or even buy / acquire assets in downturn.

Buy Cannabis stocks… OGI.

Cannabis is the ideal sin stock for this environment (social isolation). I expect a lot of people will be staying at home smoking, eating, drinking vaping cannabis.

The lower the stock prices get the more likely they will be bought up by cigarette manufacturers or pharmaceuticals. Big pharma is already nervous about the application of marijuana in healthcare. There are a number of applications that could replace high priced prescription drugs.

https://seekingalpha.com/news/3532273-organigram-inks-new-medical-cannabis-supply-deal

“all in!”

Closed all shorts at the predictable dip 30min after the open.

Went long with side cash. Even bought Boeing! Couldn’t help it

You Zig , I Zag!

New infections numbers coming out . Not good.

Taking profits, and reopening shorts.

I was just reading that DBV Technologies are waiting for approval of Viaskin which would be a competitor to AIMT’s product.