Opinion on  Morningstar Inc. (MORN)     Sector: Technology  >  Industry: Computer Services
Morningstar (MORN)

I try to do several things on this blog. And unfortunately, as an amateur the organization here could be improved :). But one of the important things I like to do is to share with you my actual trading portfolio, the buys, the sales, the successes and the failures. It is through this that I maintain the discipline to continue with my grand investing experiment. It is knowledge that I am responsible to all of you that has motivated me to continue to exercise discipline in my trades....

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

A few moments ago, checking my holdings in my Trading Account, I noticed that Morningstar had hit a 'sale point' and I sold 27 shares, 1/6th of my 167 share holding, at $52.32.  These shares had been purchased 11/22/05 at a cost basis of $32.57.  Thus, this represented a gain of $19.75 or 60.6% on the original purchase.  This was my second sale of Morningstar shares, having sold 33 shares of Morningstar 2/16/06 at a net of $42.94, which was at a gain of $10.37 or 31.8%.

As you may know, my strategy in this account is to sell portions (currently 1/6th of remaining shares) at targeted appreciation points, which I have set at 30, 60, 90, 120, then 180, 240, 300, 360, then 450, etc.  This sale also creates a 'buy signal' entitling me, since I am well under my maximum 25 positions (currently holding 15 positions) to add a new position to my holdings.  As I like to say, "that nickel is burning a hold in my pocket already!"

When do I plan to sell Morningstar shares next?  As I noted above, on the upside, if the stock should appreciate to a 90% appreciation point, then I shall be selling 1/6th of my 140 shares (23 shares), or on the downside, if the stock should retrace 50% of the highest sale point, or back to a 30% appreciation point (1.3 x $32.57 = $42.34) then I plan on selling all remaining shares.

I believe that this pattern of selling gaining stocks slowly and partially and declining stocks quickly and completely will prove to be an effective strategy at creating a winning portfolio.  Of course, this is a work in progress, and time will tell if this will be successful!

Thanks again for stopping by and visiting!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

As I like to do from time to time on this blog, I would like to share with you the current status of my Trading Portfolio.  I last wrote up my "trading portfolio update" on June 7, 2007, a month ago.  There have been a few changes since then.  But the biggest development has been my partipation in Covestor.  You now can check my Covestor page and see the daily changes, all trades, and my performance relative to the indices and other registered investors.  Thus far, I have been doing quite well as it has been a fortunate month for me especially with he Ventana bid by Roche.  I am always grateful when my portfolio and my investing strategy is woking; but I am aware that there will be times when nothing seems to work.  Sometimes the most successful approach is about persistence and patience.

This past month also found me shaken-out of Gildan Activewear, which seemed to almost know I had sold on a dip and gleefully turned around to move higher making the top % gainers list that same day! O.K. that's a bit too anthropomorphic, but still, don't you just hate those days sometimes :).

So I am back to 19 positions.  Let's take a look at them and I will share with you in order: the symbol, number of shares, date of purchase, price of purchase, latest price (7/6/07), and percentage gain (or loss).

Baldor Electric Co. (BEZ), 140 shares, 5/22/07, $47.19, $50.04, 6.04%.

Bolt Technology (BTJ), 129 shares, 1/12/07, $17.44, $56.43, 223.63%

Cerner (CERN), 120 shares, 2/2/07, $49.76, $58.23, 17.02%

Coach (COH), 61 shares, 2/25/03, $8.33, $49.37, 492.58%

Covance (CVD), 119 shares, 4/9/07, $62.61, $70.19, 12.10%

Hologic (HOLX), 120 shares,  1/31/07, $55.58, $56.46, 1.58%

Harris (HRS), 120 shares, 1/31/07, $50.05, $55.91, 11.71%

Kyphon (KYPH), 125 shares, 5/20/05, $29.21, $53.18, 82.03%

Mesa Labs (MLAB), 210 shares, 5/23/07, $24.05, $24.75, 2.90%

Morningstar (MORN, 140 shares, 11/22/05, $32.57, $47.61, 46.16%

MEDTOX Scientific (MTOX), 350 shares, 6/26/07, $28.58, $29.89, 4.57%

Precision Castparts (PCP), 86 shares, 10/24/06, $69.05, $127.82, 85.11%

Quality Systems (QSII), 88 shares, 7/28/03, $7.75, $39.04, 403.82%

ResMed (RMD), 150 shares, 2/4/05, $29.87, $41.72, 39.68%

Satyam Computer Services (SAY), 210 shares, 4/20/07, $25.55, $26.25, 2.73%

Starbucks (SBUX), 50 shares, 1/24/03, $11.40, $26.55, 132.80%

Universal Electronics (UEIC), 155 shares, 2/23/07, $25.24, $36.78, 45.72%

Meridian Bioscience (VIVO), 270 shares,  4/21/05, $7.42, $22.00, 196.54%

Wolverine World Wide (WWW), 200 shares, 4/19/06, $23.55, $28.51, 21.08%

Since my last review on June 7, 2007, I sold 23 shares of Ventana at $76.83, and the rest of the 139 shares of Ventana (VMSI) at $76.502 later the same day on 6/26/07.  On that day I purchased 350 shares of MEDTOX at $28.5534, Bolt hit another appreciation target and I sold 1/7th of my holding (21 shares) at $50.52.  Finally, on 7/5/07, I sold my 210 shares of Gildan at $33.1101 when it hit an (8)% loss after purchase.

Currently I am at 19 positions.  My equity value is $119,962.09, my margin balance is at $56,031.51, giving me a 53.29% margin equity percentage.  As of 7/6/07, I have $33,571.01 in unrealized gains in my account, and with the above trades have taken $3,100.15 in net short-term gains, and $17,824.18 in net long-term gains for a total of $20,924.33 in realized gains for 2007.  I also have paid $2,563.07 in margin interest and have received a total of $272.58 in ordinary dividends and distributions and miscellaneous income.

Please let me know if you have any comments or questions regarding my Trading Account.  Please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.  If you get a chance, be sure and visit my Stock Picks Bob's Advice Covestor page, where you can see a third-party analysis of my holdings and performance.  

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

The market sure did turn around quickly today.  I sold two of my positions early this morning only to find the market heading higher into the afternoon.  In fact, my Morningstar stock had a big move, closing at $62.37, up $3.60 or 6.13% on the day. I sold 20 shares of my 140 share position at $62.61 at 3:27 pm this afternoon, just 1/2 hour prior to the close of trading.  These shares were purchased 11/22/05 at a cost basis of $32.57/share.  Thus, I had a gain of $29.80 or 91.5% since purchase.  This was my third sale of Morningstar, having sold previously at both the 30% and 60% appreciation targets.

Since I was down to 18 positions after selling both my NOV and my BEZ holdings, and since this was a sale at an appreciation target, I now had permission to actually ADD a new holding to the mix.  Having written up CUB earlier today, I purchased 280 shares of Cubic Corporation (CUB) at the price of $32.2856 at 3:29 pm, again just 1/2 hour prior to the close of trading.  

I emphasize these times because I want to make it clear that the late sale and purchase was after I had written up the stock report on Cubic this morning.  I hadn't planned on buying any of CUB until I was surprised to see the big move in MORN late in the day!

Anyhow, it was a volatile day in the market for all of us and my portfolio got whip-sawed a bit as well.  But I am back to 19 positions, overall my portfolio didn't do too badly, but there are two less old positions and one new one in the mix.  Wish me luck.

Thanks again for visiting!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Bob 

Hello Friends!  Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice!  As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisers prior to making any investment decisions based on information on this website.

A little earlier today I noticed that my Morningstar stock (I do not do this automatically) had hit an appreciation target on the upside, passing the 120% appreciation level.  (As you probably know, I use targeted appreciation levels after stock purchases to sell portions of my holdings.)  I had sold Morningstar (MORN) shares 3 times previously, thus my target was at a 120% level (the first three levels being at 30, 60, and 90% appreciation points.)  I sold 1/7th of my 120 shares which worked out to 17 shares at $71.89.  These shares had been purchased 11/22/05 at a cost basis of $32.57.  Thus, I had a gain of $39.32 or 120.7% since purchase.

Since I was under my 20 position maximum, this sale at a gain gave me a "permission slip" to add a new position to the portfolio.  I did purchase shares of U.S. Global Investors (GROW)....more of that later.

When would I sell next?  On the upside, my next targeted level is at a 180% appreciation point.  I go with groups of four sales and then increase the interval by 30%.  Thus, 30, 60, 90, 120, then 180, 240, 300, 360, then 450% etc.  At that time, I would also plan on selling 1/7th of the remaining shares of 103/7 = 14 shares at 2.8 x $32.57 = $91.20.  On the downside, after a 120% partial sale, my new targeted sale point would be at 1/2 of that appreciation level or at a 60% appreciation from purchase which works out to 1.6 x $32.57 = $52.11.  At that level, I would plan on selling ALL remaining shares.  Much like what I did with Bolt (BTJ) which retraced to 1/2 of the highest prior appreciation point.

Thanks again for visiting!  If you have any comments or questions, please feel free to leave them on the blog or email me at bobsadviceforstocks@lycos.com.

Bob