Even though it looks like we may be in for a continued bull market, things appear a little toppy for lots of stocks and lots of insiders are selling at these high prices. Also we believe the Greek problem and the solution is a big problem, and we think the U.S. has a big problem thanks to Bush and Obama. We always thought the European Union was an ill conceived idea, with open borders and one currency, and people are beginning to realize now that it was. Why would any prosperous European country (Like Germany) let another European country like Greece screw up their country’s finances? It’s idiocy at its worst. So yesterday we took profits in some of our positions in our aggressive portfolio and sold a lot of positions that could easily decline (we bought them relatively high) in a correction….better safe than sorry.
We have immediate sell ratings for the following stocks, all with significant insider selling: Marriott (MAR) 37.68; Tempur-Pedic (TPX) 34.59; Apple (AAPL) 266.35; Juniper Networks (JNPR) 28.99; Msc Industrial (MSM) 56.10 again; Stanley Black & Decker (SWK) 63.31; GSI Commerce (GSIC) 28.05; Estee Lauder (EL) 66.13; VMWare (VMW) 62.69; Salesforce.com (CRM) 87.72 again; Netflix (NFLX) 101.99 again; American Express (AXP) 47.20 again, and Procter & Gamble (PG) 62.68. The stock picks below are for the most part speculative, but with good charts and relatively low historic prices.
We believe there will be a rotation out of the big name stocks that have had terrific runs since March of 2009, into stocks of lesser quality that look like they are just getting started. One of our favorite micro penny stocks, MedGen (MDIN) is not listed below (and we have a position in it) we believe is a great gamble – closed yesterday at .0001. We believe they are going to hype the stock and run it up for big potential profits. It ran up over 1,000% in March from a .0001 price to .0013 intra-day and it closed yesterday back down to where it started….at .0001. Our normal buying strategy is to buy 40% of our position now and 30% more on each 20% decline from the original buy price….in order to ensure good entry prices.
Our stock picks (solid stocks we like): Jefferies Group (JEF) 27.17; Duke (DUK) 16.93. Speculative stocks we like with good charts and reasonable prices: Igate Capital (IGTE) 13.18; Beneficial Mutual (BNCL) 10.41; Cardionet (BEAT) 9.98 (AGAIN); China Sunergy (CSUN) 4.70; West Coast Bancorp (WCBO) 3.30; Trico Marine Services (TRMA) 3.00 and Drinks Americas Hldgs. (DKAM) .0146. This market letter was published at 8:20 AM on Tuesday, May 4, 2010. It has been edited for clarity.
* Cotton’s “Stock of the Week”
** We hold a position in the stock or option
GO TO STOCKCHARTS.COM TO VIEW THE ABOVE STOCK PICKS
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