I had a mixed bag of winning and losing calls in 2013.
One big winner was the bullish article I wrote on Opko Health (OPK) and its extensive insider buying on March 4, 2013. Philip Frost, the billionaire CEO of Opko, was buying up thousands of shares almost on a daily basis. The price of OPK stock then was $6.99, and the closing price today was $11.63 — a gain of 75% in less than a year. Frost has continued to use every single stock pullback as a buying opportunity, and despite a large number of shorts on the stock, it has done quite well this year.
Another big winner was the bullish article on Jan. 15 of two new IPO REITs that invest in single-family homes. One was Silver Bay Realty Trust (SBY), but I was only neutral on their prospects. The one I was really bullish on was Altisource Portfolio Solutions (ASPS), which is up 67% since then (vs. a 24% loss for SBY). I believe I called it right because I knew the market for single-family home rentals was still strong, and because Altisource had a much better business model from the start than Silver Bay.
Unfortunately, this year there were also a few calls that I got wrong.
I wrote an article about extensive insider selling at Texas Instruments (TXN), and said that the selling could be a very bearish sign for that stock. TXN was $33.35 at the time, and just continued a steady climb higher throughout the year. Either the insiders were dead wrong about their own company, or I was wrong about what the selling meant. I think it was me with egg on my face.
Another call I got wrong this year was telling investors to hold off on buying Tesla Motors (TSLA) in mid-May at $92.25 per share. I said it was better to wait for a pullback since the stock had already run from $35 and was thus wildly overbought. Thereafter, TSLA stock ran up to $190 before that pull back ever came. Today’s closing price was $141.60 — a gain of 53% from the day of my article.
Sometimes you just can’t expect a runaway train to derail just because you want to buy it at a better price. Tesla is the classic momentum stock if ever there was one.
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.