Mr. Sensitive

April 5, 2012

FSX Thursday Update

Filed under: Uncategorized — lbej @ 17:48

As we were down 160 on the Dow Wednesday, the question was being loudly asked: is this the long awaited correction?  My answer: if folks are in a position to muse about whether it is or it isn’t, then it isn’t.  When the correction comes, it won’t be an orderly dip.  Right now we look to be setting up for a 2011 redux.  I’m really wondering if the ‘sell in May and go away’ canard is actually investible.  If you disregard 2008 and 2009—when much of the smart money was betting on the total collapse of the banking system—selling in late spring and buying again in late summer has been a winning trade.  My theory is that the money managers who need to buy stocks each quarter do it early in Q2 and late in Q3, so the shorts target that summer lull to do their thing.  It’s not a good idea to test your short ideas when you have to go against large, indiscriminate money flows.  If we sell off in late spring and rally in the fall again this year, that will be the clincher.  That’s not what President Obama wants, but it wouldn’t hurt him to have to try a little to win reelection, something he won’t have to do if the market holds on or adds to the year’s double-digit gains.

It’s a short week in the equity markets; we’re closed tomorrow for Good Friday, and I’m sure all the Wall Street bankers will be spending their time off in church.  My guess is that if the Catholic amongst them do make time for confession this Easter, they’ll need more than a three-day weekend for all the Hail Marys they’ve got coming.

The Family Stock Index eked out a gain of 0.1% to close at 13,434 on the back of the bidding war for Justin.  The rest of the major indices dipped slightly, by one percent or less—does anything about that say ‘correction’ to you?  Talk to me at the end of May.  Or better yet, don’t.

Advancers

  • Justin (WOLF) +15%.  As I expected, another bidder came in for Justin today, with KSL Partners offering $6.25 per share, well above the insulting $5 offer agreed to by Justin’s management last month.  The stock closed today at $6.58, higher even than the latest offer, suggesting that the excitement is far from over.  To add some perspective, WOLF came public in 2004 trading well above $20.  Now that we know the upcoming wedding will be the cat’s pajamas, can the board take anything less than $10?  Maybe, but good luck closing the deal at $5 with the proverbial cat out of the proverbial bag.
  • Reagan (REGN) +5.8%.  Reagan’s at the beach this week, decompressing.  In the meantime, Justin passed her for the 2012 FSX lead (+127% to +123%); I won’t tell her if you don’t.
  • Lee (MSTR) +3.8%.  Looks like I’m finally doing something right; the next step is to figure out what that is.
  • Lulu (LULU) +3.1%.  Does the market want us to fight?  I sure feel like I’m being goaded into another throwdown.  When I go out and buy a Super Soaker this weekend, just remember I’m doing it all for the good of the FSX.

Decliners

  • Zondro (ZQK) -3.7%.  Maybe Zondro doesn’t like getting slapped in the mouth as much as Brinky likes slapping him in the mouth.
  • Brinkley (BCO) -6.2%.  So I guess we can’t have chairs at all now.

Does anyone win in this scenario?  I say no.

  • Zero (ZIP) -7.3%.  The big move is less than a month away, and the market isn’t sanguine about the relative amount of lifting that’s fixing to occur, from a Charlotte vs. Zero standpoint.  I’ll be happy to pitch in…if they move in next door.  That house is about to go on the market, so it’s not too late.
Name Ticker 4/5/2012 Change
Brinkley BCO $22.40 -1.47
Charlotte ICE $138.60 +1.18
Dustin DST $54.33 +0.10
Icarus FLOW $4.06 +0.04
Jenny JNY $12.27 -0.29
Jodi Ann JOY $75.03 +1.53
Justin WOLF $6.58 +0.86
Katie CATY $17.72 +0.02
Lee MSTR $145.26 +5.26
Lisa LNCE $26.02 +0.17
Lucas LEI $2.34 -0.14
Lulu LULU $77.06 +2.33
Marcus MCS $12.51 -0.04
Mario T.E. MGEE $44.13 -0.26
Mario T.Y. SUP $19.21 -0.33
Marisa MOLX $27.47 -0.65
Namilita NL $14.60 -0.30
Nicole B. NI $24.50 +0.15
Nicole L. COL $56.19 -1.37
Reagan REGN $123.44 +6.82
Ruby RJET $5.00 +0.06
Wilson WILC $4.38 -0.02
Winston ED $58.18 -0.24
Zero ZIP $13.73 -1.08
Zondro ZQK $3.89 -0.15
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