I am fond of saying that time and value work and they work well in the stock market. This week for some reason Value decided to pack its lunch pail, put on some steel toed boots and work at an extraordinary pace. If you look at the top performing stocks so fat this week (and its only Wednesday) here are some the big gainers.
LSI Logic (LSI) is up 34% after receiving a takeover bid
NorthStar Finance (NRF) has jumped 26% after they announced a spinoff of their asset management business
AerCap Holdings (AER) is up a whopping 64% after an announcement that they were investing heavily in their finance unit
Cross Country Healthcare (CCRN) announced they were buying the assets of Alled Heathcare and saw their stock rise by 23% so far
KKR Capital (KFN) announced that it is being bought by Kohlberg Kravis and the stock jumped 35%
A jump in the Baltic Dry Index helped drive Star Bulk Carriers (SBLK) and Global Ship Leasing (GSL) higher by more than 20%
All of these huge gainers so far this week share a common trait. They were recommended by me in the past year or so. To top it off the gains this week are just the icing on the cake. I have owned all of these for a while now and the total gains are nothing short of spectacular. Our long term gain in NorthStar is more than 200% since 2011. Since the initial recommendation in May of 2012 we have total return of more than 70% in KKR Capital. Cross Country is up more than 77% since March of 2012 when I suggest long term investors take a position. LSI has provided us with a gain of 77% since May of this year while AER is up more than 100% since I recommended the stock in November 2012. I just added the shipping stocks to my International Deep Value Portfolio in September and have gains already of 24% in GSL and 38% in SBLK.
I am not going to be one of the guys who blows smoke at you and says that all of my stock picks will work this well. Some will not. However I will tell you that cheap stocks with a huge margin of safety such as the ones I like to buy do usually work out given enough time. Value investing takes patience and discipline and when it works (as it does most of the time) the gains can be extraordinary and well in excess of the market returns.
If you are a trader or investor who likes sitting up all night playing with stock charts or has the time to spend in front of the screen all day trading frantically in search of returns, the idea of long term value investing might not work for you. However if you have a life, a career, a family or hobbies and other interests in life besides the stock market and still want high returns on your hard earned investment capital the taking advantage of deep value investing with margin of safety as the primary concern should be your approach.
It’s the holidays so I want to make a special offer in the spirit of the season. We are getting ready to kick off our first full year of both the Tim Melvin Deep Value and the International Deep Value Letters. If you are looking for a way to put your money to work in safe and cheap stocks as well as learn the concepts and tools of this approach to the markets I have an offer for you. The Deep Value Letter sells for $490. So does International Deep Value. I have run several specials this year in a buy one get one get one free promotion so I will do that again.
But its Christmas and I am in the holiday mood. If my approach to the markets emphasizing the margin of safety and private equity mindset appeals to you, I want you to be a part of the value investing community here at The Tim Melvin Value Letters on Marketfy so I will sweeten the pot from now until Christmas Eve. I will give you the buy one get one but for just the next few days I am marking the price down a bunch. You get both letters for one full year for just $359.
No Hype or amazing claims. Just a good deal on solid common sense investing that has been proven to work.
Use this link to sign up for my Holiday offer.