fool.com Hidden Gems

I recently subscribed to a Motley Fool newsletter, and I've been spending the (way too much) cash in our IRA accounts buying up small positions of obscure little companies. I like unknown companies that make money and might make more. I appreciate the Motley Fool guys for their no-nonsense approach to investing. Their newsletters are sort of expensive, but they don't pimp stocks for personal reasons, or to gain commissions, or to sell advertising. I don't take most of their recommendations, but they're always interesting.

Back in October, I named the stock I was looking at -- K-Swiss (KSWS), who makes fancy tennis shoes. I didn't buy them; not sure why. They're up 60% since then. Dang.

I sold most of my Polish liquor company, Central European Distributing Company (CEDC). It's up about 900% since I bought it, but I kept selling half every time it doubled, so I didn't make as much as I could have. Now I think it might actually be overvalued. I should have sold it all, but it's been such a winner that I'm a bit sentimental, so I kept 100 shares.

Stocks I've bought recently are:

Acme United (ACU) makes school supplies, like scissors and staplers. Up 50% since my purchase; still looks pretty good.
Cryptologic (CRYP) makes internet gambling software. Just bought it; highly risky. Not as profitable as I like, but looks like a good growth area.
Cutter and Buck (CBUK) makes golfwear. Down 4% since I bought it. Don't know much about them.
eSpeed (ESPD) makes stock trading software. Up 26% since I bought it. Stilll looks good.
Neenah Paper (NP) makes paper. Just bought it. Short term kind of risky because wood is so expensive now, but long term I like them.
Pioneer (PIO) is the Japanese electronics company. The declining dollar should hurt their profits, but the soaring Euro should help. Up 6% since I bought it.
Sharper Image (SHRP) is the catalog gadget company. They've had a bad year, but I figure they'll have a good year some day. Down 3% since I bought it.
Select Comfort (SCSS) makes fancy mattresses. Up 10% since I bought it, and looks promising.
QLT Phototherapeutics (QLTI) develops eye disease drugs. Down 2% since I bought it. Very high risk, but good upside potential.
Sanderson Farms (SAFM) produces chicken. Up 17% since I bought it. Looks OK.
Stanley Furniture (STLY) makes snooty wood furniture. Up 2% since I bought it. Looks OK.
TRI Continental (TY) is a market-traded mutual fund that is valued some 15% lower than the value of its holdings. I normally abhor mutual funds, but this looked like a pretty safe place to store some spare cash. It's gone up 3% since I bought it.

Most of these haven't changed that much, but it's only been 3 months for the oldest of them.

I've got a sale order in for my Sara Lee (SLE) stock, which is up 45% since I purchased it in April 2003.

Filed Mon - January 3, 2005, 12:16 PM in

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