Stocks I am buying
It has been a brutal year for investors. High inflation and equity prices collapsing. The tech bubble is over. If you needed high growth assumptions in your model and a low discount rate you have gotten slaughtered. The only thing that held its ground was energy and now that is beginning to tumble on recession fears. Nothing is safe and everyone is getting impacted.
I was up 40% at the peak. Feeling good while everyone else was down 20%. Today I am only up 10% and with the way commodities are heading it looks like we could get some ugly movements soon.
I have a lot of cash which helps give me comfort in a market that collapses more everyday. Been searching for opportunities to deploy the cash but have not found many high quality ideas. In a market where everything is falling, buying the high quality stocks matters over the sub-par businesses ran by an 85 year-old man.
I see a lot of value in media names. I’m a big radio guy and love the space. I’ve talked to most of the players in the industry and have a good understanding who is good and who sucks. The market has sold off these names as investors believe ad spending is going to dry up in a potential recession. What the market seems to be missing is the large political spending year that seems to be ballooning even more with Roe Vs Wade. The question is if political spending will offset any potential offset in the national ad market. That remains to be seen, but investors who pick the right names should do well here.
The largest part of my portfolio is energy names. I like the unlevered debt free ones that make money in all environments. Two names I own have cash rich balance sheets and will be returning capital to investors quite shortly. At current energy prices they are printing money. Even if oil goes to $60/bbl cash flow will be generated. If you want to own commodity names you gave to buy the ones that make money in all environments. Commodities are tough. I’ve written these names up recently for Alpha Letter Pro subs.
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