1. Sold 50 FCY in Roth at $20.5 (see Disclaimer): FCY is a junk rated senior bond from Forest City, and I exited my small position today. This position was bought at $18.75 in December, and one quarterly interest payment was also received in January. Item # 3 Bought bond FCY The purchase yesterday of the senior investment grade bond from Vornado is viewed as a substitute for FCY. Bought in ROTH 50 VNOD at 24.86 FCY matures in 2034 and VNOD in 2039, so both have a ton of interest rate risk as long term bonds. I currently view the credit risk of VNOD as better however.
2. Emerson Electric (owned): Emerson Electric (EMR) beat the consensus estimate by 14 cents, reporting an E.P.S. of 56 cents for its 1st quarter of the 2010 FY. EMR expects full year earnings of $2.2 to $2.4 per share based in part on what it call "improving business conditions in the first quarter" and "improving recent order patterns". Operating cash flow for the 1st quarter was 687 million. Emerson shares were up strongly in today's trading, moving up over 10% to close at $46.77 (+$4.29)
3. Marathon (MRO)(Owned): MRO, like the other integrated oil companies, is suffering from weak refining. Marathon Oil reported a 4th quarter E.P.S. of 50 cents, missing expectations by 14 cents. During 2009, Marathon added net proved reserves of 675 mmboe, while producing 149 mmboe, resulting in a reserve replacement ratio of 452 percent.
4. RRSAT (Owned): RRsat reported GAAP E.P.S. for the 4th quarter of 16 cents on revenues of 24.8 million. Both the revenue and income numbers were hurt by the termination of a contract by RRST due to the alleged failure of its customer to honor their contractual obligations. RRST also declared a dividend, which will be subject to a 20% withholding tax applied by Israel. The firm issued guidance for 2010 revenues of 107 to 110 million, in line with expectations. As of 12/31/09, RRST had 47.5 million in cash and marketable securities. I purchased 50 shares last November a at $9.92. The market did not much care for this earnings report.
5. ADDED 70 TRST at 5.9 (Category 2 Regional Bank Strategy) (see Disclaimer): This purchase would be an average down from the 50 shares bought in December at $6.3. Bought 50 TRST at 6.3 This is a small regional bank operating in New York. As I mentioned in my post discussing the prior purchase, I had bought and sold this one profitably in the past as a LT, and really did not expect much price appreciation in the shares. I would be very pleased with a return to a $10 to $14 price within six years, where the stock was trading most of the time between 2000 to 2008: TrustCo Bank Corp NY Share Price Chart
Trustco reported 4th quarter earnings of $.111, an increase from the $.094 per share earned in the 4th quarter of 2008. ex99 The bank remained profitable in both 2008 and 2009. As of 12/31/09, the net interest margin was 3.27%, and the nonperforming asset to total asset was 1.5%. The allowance for loan losses to total loans was 1.65%. The Tier 1 risk adjusted capital was 12.04% and the total risk adjusted capital was 13.3%. At a total cost of $5.9, the dividend yield is close to 4.2%.
The current estimate from the one analyst that follows the company is for an E.P.S. of 51 cents in 2010 up from the actual $.37 in 2009: TRST: Analyst Estimates for TrustCo Bank Corp NY
6. Sold 50 EUO at 19.58 Today (See Disclaimer): This double short for the Euro was recently bought at $17.17. The Old Geezer does not need a reason to sell, just dump it if it does not feel right is good enough for the OG. After discussing the U.S. deficit situation, I am not sure why I was going double long in the U.S. dollar versus any foreign currency.
7. Added 50 VNOD at 24.85 (see Disclaimer): This was bought as the replacement for EUO in the main taxable account. This senior bond is adequately discussed in the post from earlier today. See Item # 4 /Bought in ROTH 50 VNOD at 24.86
Tidbits:
Vanguard has launched some new low cost bond ETFs. One is called the Vanguard Intermediate-Term Corporate Bond ETF (VCIT), with an expense ratio of .15% and a current SEC yield of 4.71%. This one currently has 189 bonds with an average maturity of 7.8 years and an average quality rating of A2/A3. Vanguard - Fund Holdings Another new one is the Vanguard - Vanguard Intermediate-Term Government Bond ETF (VGIT) with a current yield of 2.55%. I would view VCIT to be a competitor to LQD, which I owned and sold several times in 2009. I do not currently own any bond ETFs for the reasons discussed in several prior posts including the following: For BND: Is it Safe is not the Right Question. Instead Ask What are the Risks & Rewards/Assume Lost of Principal Possible / Item # 2 /Risks of Bond Funds / Item # 3 Sold all of WIP ETF-View Risks Now Outweighing Potential Reward/ Item # 3 /Bill Tedford's Inflation Prediction & His Sell of TIPs
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