On 15 November 2017 the purchased shares have been sold at USD 98.78 due to reaching the stop loss limit. The realised profit over two weeks before any taxes and fees is 2.38%.
On 27 October 2017 long position has been opened at USD 96.48 in Celgene. The global biopharmaceutical corporation formed a positive mid-term outlook: the USD 13 bn estimated revenue for 2017 is projected to grow by 14.5% CAGR to reach USD 19-20 bn by 2020.
The key issue was that this revised guideance is lower compared to the previous one, therefore the shares have plunged from an all time high above USD 145 to below USD 100 recently. The current trade idea is a bet on the feeling that the market probably overreacted the story and the company can offer significant upside in the future.
On 31 May 2017 the long position in TSCO has been closed at USD 54.02 due to reaching the stop loss level. The realized 1-week profit before any taxes and fees is 1.92%.
As we all know from Ocean’s trilogy, playing a story once again is probably not the best. In case of Tractor Supply Co. this feeling has been underlined by different segment and company specific factors as well:
- The outlook of the classic US retail players have been weakened mainly due to the increasing dominance of e-commerce business models. Year-to-date number on retail store closures is already outpacing that of 2008 (year of latest recession in the States) and appr. 2,880 have been announced so far this year according to Credit Suisse.
- TSCO’s share price dropped significantly and its valuation (and its expected dividend yield) is far more expensive compared to its peers.
Historical share price performance of Tractor Supply Company, source: Yahoo Finance
On the other hand the low-debt company could offer some locked in potential. Based on the analysts’ consensus the long-term growth prospects remain roboust despite the disappointing quarterly performance and the 12m projected share price might offer more than 20% return.
Considering all these pros and cons a new long position in TSCO has been opened at USD 53 on 24 May 2017.
On 30 December 2016 the long position in Tractor Supply Company has been closed at USD 75.41. The realized profit before any taxes and fees is 10.1% (not annualized).
On 12 November 2016 Amgen position (previous post) has been stopped out at USD 146.09. The realized profit is 4.65% before any taxes and fees.
3-year share price development of Amgen (USD)
On 2 November 2016 long position opened in Amgen at USD 139.6. Main underlying characteristics of the investment decision:
- recent share price drop pushed the stock price into oversold territory, but majority of the brokerage firms has buy or hold recommendation
- key global leading biotech player
- as an important result of its ongoing restructuring plan, in the future increase in margin is expected