Subscriber alert: closed CMA, opened HZO, increased position for BWA
- Jan 7, 2021
- 2 min read
Hope you are making tons of money in the past 2 days. Not sure how long this will last, but the ride was awesome. Many of my stocks are running, some breaking through resistance levels.
Updates:
1. Closed CMA today with a 60% profit. I had a small stake in it and while my price target was $70, decided not to wait and use this money somewhere else.
2. Added to BWA. Analysis can be found here: https://www.wininstocks.com/post/borgwarner-inc-bwa-stock-value-analysis-financials-predictions
It wants to move higher as it broke through a short-term channel that could be considered a bull flag. Overall, I am quite bullish here, so no bad feelings at all.
3. Opened HZO (MarineMax, Inc). Wonder what you think about this one.
MarineMax, Inc. engages in the provision of boating-related activities. The firm sells used and new sport boats, sport cruisers, sport yachts and fishing boats through retail stores. It also provides maintenance, repair, slip and storage services. The company has 77 retail locations in Alabama, Connecticut, Florida, Georgia, Maryland, Illinois, Massachusetts, Minnesota, Missouri, New Jersey, New York, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina, Texas, Washington, and Wisconsin. MarineMax, Inc. The company was founded in January 1998 and is headquartered in Clearwater, FL
I like the recent price action: bouncing off the previous resistance line, staying above MA lines treating those as support.
The company is benefiting from COVID with fast growing sales that leverage well into profits. and with the spring/summer approaching with lockdowns potentially in place it should be in the good shape. But also, those who have picked the new hobby are likely to come back even after COVID.
The company has been busy buying new locations, establishing new partnerships, and ! buying back its shares ! over the past year as seen here:
HZO is currently trading at a PE of 11. To start with, this is low compared to the US Specialty Retail industry average of 19.4x or the US Leisure industry average (32.8x). So, there is a chance of appreciation right there.
Also, analysts are predicting EPS to grow in the next 2 years and reach ~$4.39. If we use a conservative PE of 15 (given the risks that post-COVID sales would decline) this would give us a price of $65.85 providing for the potential for 73% upside in the next year or so.
Obviously, the key risk for HZO is the change in the COVID behaviors that may not maintain after COVID is over. However, HZO is likely going to be in a better position anyway by the end of COVID with more locations, inventory, partnerships, clients, etc. More locations allow for cost savings.
Disclaimer: I own HZO stock and all the usual stuff. You know it: do your own due diligence, etc. Cheers!
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