I'm still sticking with a P/E low, below 15x on the stock screener but hopefully below 5. Also and Price to book below 1, preferably below .7. In other words, I'm still researching and I'll spare you the details of the dozen companies I have passed over in the last few days. Most of them you have never heard of, which is most of the reason I passed on them. However, I passed on Citigroup and Credit Suisse because I also have more than 10% of my account in one financial company and I don't trust banks enough to dump everything into banking stocks despite the fact that I expect most bank stock to go up 20-40% this year.
I changed some of my search criteria until I found the following combination:
|DHT 6 Month Chart and Overview
However, there is never a perfect paradise. One of the largest shareholders, an investment company, MMI, recently dumped over a million shares some 2% of the company or more. That is partly responsible for the price decline over the last two months. Why did they sell? Well, as they are an investment company I figure that they don't hold stocks less than $1.00. It's a mental thing. Stocks in that range feel cheap. Below $5 is another perfect example, most large investment companies dump at that level. Bank of America had that kind of moment a few months ago dropping into the $4.90s a few times one week. Now it's up to $7.84. The point being large shareholders selling is not a good sign, but it is not always a bad sign.
How do I personally connect to DHT? I like the idea of double wall tankers. Single wall tankers are the kind that seems to always be getting into oil spills. Plus, with the situation in Iran, oil trafficking might be of increased importance over the next few months or even years, in other words, the price will go up. Even if we do not get any oil from Iran, say Russia and China do get oil from Iran. If they no longer get oil from Iran through a pipeline or local tankers, they will need oil transported the long way, using tankers, preferably double hull tankers. Secondly, the economy is better than the media is portraying, the same way it was worse than they portrayed in 2007 and 2008 and 2009. So I expect more people to vacation in the US this year, thus using more oil. So I expect the price to go up significantly this summer. The more money each tanker cargo goes for at port the more the companies owning the tankers will be paid.
|Buy Order for DHT
One last comment pertaining to microcap stocks I am unfamiliar with and my value formula. I sold GRVY stock this week for $1.82 a share after buying it at $1.42 per share about 22 days earlier. I had a target price on the stock of $1.88 but it went up so quick that I sold it a little early even though it is now trading at $1.96 or something ridiculous.
|Gravity Company Win
Article completed 8:45 PM. (Still not watching the Superbowl.)