Thursday, February 9, 2012

Par Technology/Bought 100 of the BDC TICC at $9.8-ROTH IRA/KO BLC/Sold 50 of the LT GY at $6.01

I will generally not discuss earnings reports from lottery ticket selections. I will occasionally pass along a news item. I noticed that one of my LT selections, Par Technology, was actually going up for a change. After hitting a low of $3.08 on 9/23/11, the shares are now trading above $5. PAR Stock Charts That kind of move caused me to take a closer look for news items, and I found two that might be contributing to the newly minted optimism. The first involves the disposition of Par Logistics Management Systems, which apparently is a non-core business, to Orbcomm.  SEC FORM 8-K The second news item was an agreement with Wal-Mart to provide "cloud based" food safety technologies. Walmart to Use PAR Cloud-based, Mobile Solution to Improve Food Safety This is a small company with a market cap at the current price of about 77M. PAR Key Statistics This LT selection has not been producing any green for me since my purchase at $5.44 almost one year ago. At least I am moving toward break-even.

I received yesterday my annual homeowners insurance bill. The premium increased by 34.3%. The total increase from 2008 is 73%. I have owned my home since 1982 and have never had a claim. Those who calculate CPI for the U.S. government are not even close to my inflation rate.

1. Bought 100 of the BDC TICC at $9.8 Last Monday-ROTH IRA (see Disclaimer): TICC Capital is relatively small business development corporation. As with any BDC purchase, I would be content to harvest the dividend and to sell the shares at any profit. The current quarterly dividend rate is 25 cents per share. At a total cost of $9.8, the yield would be 10.15% approximately assuming a continuation of that penny rate.  TICC Stock Quote 

This is a link to the criteria used by this BDC when making investments.  

TICC was discussed in this recent article at Motley Fool

TICC Capital website. 

As of 9/30/11, the net asset value per share was reported at $9.34. Form 10-Q TICC's investments are listed starting at page 4 of that 10-Q filing. 

There are ETFs and ETNs that invest in BDCs. The Powershares Global Listed Private Equity Portfolio (PSP) has an expense ratio of 2.58%, something that I would never consider buying for that reason. UBS has two ETNs that invest in BDCs, one of which is leveraged. ETRACS BDCs  A ETN is a senior unsecured note that exposes the investor to the credit risk of the issuer in addition to risks associated with the underlying investments. I would not consider using leverage to buy BDCs.  I have never owned these securities. 

There is also a website devoted to BDCs called the BDC Reporter

TICC Capital closed at $9.79 yesterday

2. Coca Cola (own: Common Stock Dividend Growth Strategy): KO reported adjusted net income of 79 cents per share, beating estimates by 2 cents. Revenues rose 5% to $11.04 billion, higher than the consensus forecast of $10.99 billion Worldwide volume rose 3 percent. SEC Filed Press Release 

I initiated my current position in KO with a purchase at $38.72. Buy of KO at 38.72 (March 2009). I subsequently added shares. ADDED 50 KO AT 54.26 (April 2010);  Bought 50 KO at 53.77 (April 2010). I quit reinvesting the dividend after the 2010 4th quarter. The cost basis for the last shares bought with a dividend is $64.51. By ceasing the reinvestment, I am signaling an unwillingness to buy shares at the current price.

Coca-Cola closed at $68.33 yesterday. 

3. Belo (BLC)(own senior bond: FINRA): Belo, a owner of TV stations, reported net earnings per share of 29 cents per share, five cents better than the consensus estimate. Revenues were reported at $180 million for the 4th quarter and $650 for 2011.  Earnings for Fourth Quarter and Full Year 

4. SOLD 50 of the LT GY at $6.01 Last Tuesday (Lottery Ticket Basket Strategy)(see Disclaimer): This concludes my second round trip in Gencorp in the LT category. The shares sold last Tuesday were bought over a year ago at $4.65. The 4th quarter earnings report did not inspire the RB to continue holding this one. SEC Filed Press Release As with all LTs, I am not going to spend much, if any, time delving into the specifics. RB, who runs this strategy, is not exactly concerned with details. The reaction was more of a gut response after reading the earnings press release.  It was just one too many lackluster reports. I made the decision to sell the shares immediately after reading the report and placed the order soon after the market opened last Tuesday. 

2012 GY 50 Shares +$52.09
The prior transactions consisted of a buy at $3.7 and a sell at $6.4.  My primary interest in this company is its undeveloped land near Sacramento.

Snapshots of LT trades can be found at Lottery Ticket Strategy: New Gateway Post. The RB runs this show. Investments are limited to no more than $300, plus any prior realized gains from trading the security. My total exposure for all LTs can not exceed my realized gain number which is close to $10,000 between 2009 to date.

GenCorp closed at $5.56 yesterday. 

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