Articles by mgedwards

Equity Scorecard update

Dear Reader, I updated the ratings on my Equity Scorecard.  The Scorecard is located at the lower right-hand side of this blog.  Please note that I am not a professional investment analyst, and I urge you to do your own research or consult a professional broker before buying or selling these stocks.  I have tracked these equities for awhile and have an idea as to how they might perform over the short term.  The ratings I suggest are a snapshot in time; I do not actively change my ratings and don’t necessary change them when critical news breaks.  I will indicate whether I own shares of this stock.
 
Infospace (INSP):  Hold.  If you own this stock, hold it until it rises to $28 per share (I own shares and will sell at $28).  If you don’t own it, don’t buy it.  I’ve been burned twice on this stock, including when I bought and sold during the dot.bomb era.  Infospace offers online and mobile search technology and content.  It competes with Google, Yahoo, Ask Jeeves, and other search companies.  It is a niche technology play.  The stock is moving nowhere fast, and it seems to drop like a rock whenever it announces that projected returns are not in line with expectations.  That happens too often for comfort.
 
Blue Nile (NILE):  Buy.  Online jewelry e-tailer Blue Nile disappointed investors with sobering earnings news earlier this month.  It also lowered its projections for 2006.  Still, with the price correction from $44.35 to $33.10 per share, I think Blue Nile has room to move up.  I do not own shares.  If you buy shares of Blue Nile, consider accumulating shares rather than buying them in large blocks.
 
Archipelago Holdings (AX):  Hold.  The parent company of the Archipelago Exchange will soon merge with the New York Stock Exchange, making the NYSE a public company.  This has been driving AX shares up.  If you had bought shares in May 2005, you would have doubled your money by now.  The easy money is gone.  I do not own shares.  I do not recommend buying shares of AX, although if you own them, you might want to hold on to them at least until the merger closes.
 
Ebay (EBAY):  Buy.  The world’s largest online market took a beating last year as growth in its core business, its online marketplace, has slowed.  Its Paypal and new Skype subsidiaries show strong promise.  Although shares are off by about 25% since January 2006, volatility leads me to downgrade Ebay from Strong Buy to Buy.  Ebay’s stock appears to be caught in a tug-of-war between volatility and maturity, indicating that its share price will be relatively flat over time but much too volatile to be appealing.  I do not own shares.
 
Krispy Kreme Doughnuts (KKD):  Outperform.  While it still makes the tastiest doughnut on the planet, the company itself has not shown that it has regained its previous luster.  I do not own shares and don’t plan to buy any in the near future.  I did, however, eat a Krispy Kreme doughnut this morning and highly recommend them if you have a craving for a good doughnut.
 
Petrochina (PTR):  Hold.  China’s upstart petroleum company has seen a huge run on its stock price ever since energy prices began to rise.  In fact, its shares have doubled in price over the past year.  Its price-to-equity ratio is a bit high for a petroleum company.  I do not own shares.  If you do, consider holding them through the end of the year because oil prices will continue to be stability or will increase, which will benefit Petrochina.
 
Salesforce.com (CRM):  Hold.  I missed out on this one.  I don’t own shares and didn’t think it would be a hot stock.  Salesforce.com sells online customer relations managment software.  In August I indicated that you should benchmark it against its peers, and the price ended up doubling in the last six months.  I downgraded it to Hold due to rumors that it lost a big contract to rival Oracle (shares dropped 10% in one day) and the fact that its price has doubled since mid-2005.
 
Sears Holdings (SHLD):  Buy.  Eddie Lampert’s creation, a holding company akin to Warren Buffett’s Berkshire Hathaway that throw off cash from its Sears, Kmart, and Auto Zone retail outlets into new investments, is still an interesting concept.  It seems that investors have cooled to the idea and are rightfully concerned that Lampert and CEO Alywyn Lewis won’t be able to turn around Kmart and Sears.  However, they’re missing out on the bigger picture.  Now would be the time to accumulate shares before Lampert buys another big company such as Albertsons and generates even more investor interest.
 
DreamWorks Animation (DWA):  Buy.  I’m now bullish on DWA, the animation unit of DreamWorks Pictures, for three reasons.  One, Pixar is being acquired by Disney, leaving DWA as the only publicly-traded computer-generated animation studio.  Two, Paramount Studios is acquiring DreamWorks, DWA’s sister company.  This will give the DreamWorks franchise additional clout.  Three, DreamWorks Animation has some interesting films currently in production, including the upcoming "Over the Hedge," Jerry Seinfeld’s "The Bee Movie," and "Shrek 3," which should reign at the box office in 2007.
 
Dell (DELL):  Strong Buy.  Ouch.  Dell’s shares have tanked since I recommended Strong Buy in August.  I do not own shares.  I reiterate Strong Buy, particularly since shares have dropped.  Owning Dell shares is still a must for any technology portfolio.  Although Dell has suffered from negative customer service image problems (plus, Steve the Dell Dude was canned and subsequently arrested), I think the king of computing hardware has plenty of room to grow.  Now that its shares are down 25% since its high in July 2005, I think it is an even better buy.
 
Overstock.com (OSTK):  Sell.  This company, a direct competitor to Ebay, is its own worst enemy.  First, it decided to sue analysts who claimed that it was overvalued and were shorting the stock.  Don’t bite the hand that feeds you.  Then, when investors were expecting Overstock.com to turn a profit, it dropped a bombshell by announcing that it will stay unprofitable in 2006.  Who knows when, if ever, it will turn a profit.  This company has squandered its potential thus far.  I sold my shares at a loss and am glad I did.  They’ve gone down even further since I sold.
 
Microsoft (MSFT):  Accumulate.  The maker of Windows and Office software continues to manufacture money.  However, its stock has moved little over the past few years.  I don’t own shares, although I recommend accumulating shares.  Microsoft should benefit from Windows Vista when it debuts later this year.  Owning Microsoft shares is a good hedge against volatile technology stocks such as Ebay.
 
Cogent Technologies (COGT):  Buy.  Cogent sells biometric technology used to enhance security.  I own shares of Cogent, and frankly, I’ve been disappointed with their performance since I bought them in mid-2005.  Cogent is a hot company in a hot industry.  I plan to stick with it through 2006 and may sell later this year if it continues to underperform.  For now, I still believe it has potential to excel in 2006.
 
Baidu.com (BIDU):  Hold.  This Chinese online search was hailed as the Google of China and debuted in an historic, oversubscribed IPO.  Since then, shares have meteorically fallen to $48.50, close to what I thought was a fair price for the shares.  Google is gaining ground in China through its Google.cn portal, so the Google of China might actually be…Google.  I do not own shares but may buy if the price continues to go down if Baidu.com continues to be a viable stock to own.
 
Morningstar (MORN):  Hold.  Morningstar is a well-known, independent analyst research firm.  I own shares have been very happy with the results.  Shares have more than doubled since its May 2005 public debut.  If you own shares, I recommend keeping them.  I am not sure how long Morningstar will continue to shine, although it should hold its current value or outperform in 2006.
 
Google (GOOG):  Buy.  Google, the online search giant, has produced stellar returns since its 2004 public debut.  I bought shares at IPO and sold awhile ago.  Lately Google’s shares have been taking a beating as its latest earnings announcement hinted that growth has started to slow a bit.  Most analysts still estimate that Google will rise to $500 per share, and it is currently at $352 per share (after hours on Friday).  I am still bullish on Google, although I currently don’t own Google.  Shares will certainly head back to over $400 per share this year.
 
Caribou Coffee (CBOU):  Caribou Coffee, a direct competitor to Starbucks Coffee, has underperformed.  Shares most recently tanked when the CEO announced that it would remain in the red for the foreseeable future.  I own shares and am still high on Caribou’s future prospects.  With its price at $8.54, far below its IPO price, now would be a good time to buy shares if you think that Caribou will be a good long-term investment.  I think it will be.

World Adventurers’ next destination?

My wife and I put together our revised list of assignments we will bid on for our next assignment.  We will be in Seoul, Korea until early 2007, when we move on to another country for two more years.  On January 19, I wrote about my initial list of preferred locations.  The initial and revised lists are not too different.  The list below is our revised list based on further research and our collective preferences.  We discarded some assignments that did not meet our needs.  For example, even though Bogota, Colombia has an assignment I would love to do, my wife does not want to bid on Bogota because of several factors; namely, Colombia is still a dangerous place in which to live.
 
Dear Reader, I need your help.  Have you been to any of the cities listed below?  Have you lived there, and when did you live there?  Did you have a good or bad experience?  I’m especially interested in reading about your experiences in lesser-known places such as La Paz, Bolivia or Damascus, Syria.  If you haven’t been to any of these cities, which would you prefer?  Where do you think World Adventurers should blog from next year?
 
Here is our current list of preferred locations ranked in order of preference.  This list is subject to change.  I will submit my final list in about two weeks.
  1. Beijing, China
  2. Wellington, New Zealand
  3. Damascus, Syria
  4. Hong Kong, China
  5. Montevideo, Uruguay
  6. San Salvador, El Salvador
  7. La Paz, Bolivia
  8. Athens, Greece
  9. Asuncion, Paraguay
  10. Shenyang, China
  11. London, England
  12. Kuwait City, Kuwait
  13. Jakarta, Indonesia
  14. Buenos Aires, Argentina
  15. Windhoek, Namibia
  16. Managua, Nicaragua
  17. Quito, Ecuador
  18. San Jose, Costa Rica
  19. Santo Domingo, Dominican Republic
Some of these locations have more than one assignment available for bidding.  I know it may seem strange to prefer San Salvador, El Salvador or La Paz, Bolivia over Athens, Greece or London, England.  However, my list depends largely on the job I’m bidding on as well as standard of living at the location where I will bid.  For example, while London is a first-class city, the housing available in Bolivia is second-to-none while London’s housing is cramped.  The cost of living in Bolivia is far, far lower than in London.  We must take into account many factors when we bid, which is why London and Athens don’t automatically rise to the top of our list.  New Zealand is near the top because the job, the city, and the amenities are all first rate.  Chinese posts get preference because I really want to work in China.  Damascus, Syria is near the top because the assignment is great, the expatriate community is excellent, and Syria is a historical and geopolitically strategic location.

Best of MSN Spaces, Part Deux

I’m honored that World Adventurers was featured a second time on "The Best of MSN Spaces."  As Jim Carrey said while portraying Stanley Ipkiss, a man bestowed with powers by the Norse God Loki in the movie, "The Mask"–You love me!  You really love me!  Someone on the MSN Spaces staff must like what I write.  Thanks, I’ll take the entire MSN Spaces editorial staff out for lunch at Pho Hoa near the Microsoft campus when I return to Seattle next May…contact me!  Seriously though, I was surprised to wake up (in Korea) and find that this blog had over 25,000 hits in the last day or so.  Dear Reader, thank you for stopping by to peruse World Adventurers and posting your comments.  Stop by anytime.  I’ll try to respond to as many comments as I can.
 
World Adventurers was initially featured on "The Best of MSN Spaces" in September 2005.  From time to time, MSN highlights the same blogs twice when they fit more than one category.  This blog was previously featured when MSN Spaces highlighted "Travel."  Now it gets the nod for "Adventure."  If you have a blog on MSN Spaces that hasn’t yet been featured, you might be wondering…hey, how come this guy’s blog gets featured twice when my blog has never been featured?  Well, I don’t really know why the editors at MSN Spaces decided to feature this blog twice.  However, I can give you some suggestions that could help your blog earn some laurels from MSN Spaces:
  1. Choose a theme for your blog, and write about related topics.  Pick a theme you think your blog audience will find interesting.  Some themes are more interesting than others.  Religion and politics always seem to attract attention, for better or for while, while niche topics do not.  Travel and adventure are popular themes.  Sports, fashion, and day-to-day insights are good.  Zany, quirky blogs do well, as do blogs with goals and objectives (e.g. if your quest is to climb Mount Everest and you’re documenting your training program, readers will be interested).
  2. Write frequently, and write well.  Frequent postings is definitely a plus.  Write in complete, grammatically-correct sentences.  Through in a few witty remarks and some seldom-used words.  Don’t be too long-winded (I’m guilty of this) or too terse brief in your postings.  If your focus is on photography or art, post intriguing, high-quality photos or sketches like my fellow blogger mars_wolf.  If you’re an artist, post samples of your work.
  3. Add original content, but document references.  It is better to document your own ideas than to recite from other sources.  Citing other sources is fine, but be sure to give credit when you refer to other people’s work.  If possible, avoid posting copyrighted material without permission.  Minimize the amount of recitation in a blog entry unless it fits into the theme of your blog post.  For example, on Martin Luther King’s Day in 2005, I cited Dr. Martin Luther King, Jr.’s entire "I Have a Dream" speech because few have read the speech in its entirety.  (My condolences to the King family, who lost Coretta Scott King, wife of Martin Luther King, Jr., this week.  It has been a very tough year for the King family.)
  4. Avoid focusing too much on your personal life unless it is absolutely riveting.  Expand your blog entries beyond discussions of your personal life, whether it be personal photos, discussions of friends, or family matters.  If you write about personal matters, tie it into your blog’s theme (e.g. your quest to win a marathon or taking care of children or getting a good job).  You can also highlight people’s personalities.  I have occasionally bantered on this blog with readers I know.  Maybe you have a crazy uncle or a quirky friend.  People love soap operas, so decide up front whether you want to play out your life on a blog.  You’ll get a lot of hits, but you may regret playing your life’s drama out on the blogosphere.
  5. Enhance your blog with photos, lists, music, and a variety of topics.  Blogs serve an entertainment purpose, so it’s good to be entertaining using a variety of methods!  If you post a blog entry, try adding photos.  Photos truly are worth more than 1,000 words.
  6. Start an e-mail writing campaign.  If you think you have a good blog, don’t be shy!  Let MSN Spaces know.  Also, you can encourage your avid readers to submit your blog to MSN Spaces for consideration.
  7. Harness the power of the blogosphere.  The Internet is about interconnectivity.  Feature links to your favorite bloggers, and ask them to link to your blog.  This will create cross-traffic.  After I met Korea’s top blogger, R.J. Koehler, aka "The Marmot’s Hole," we featured each other’s blogs and generated significant cross-traffic between them.  We also listed each other’s blogs in our favorite bloggers’ list.