Tom Nash
patreon
Undervalued Recovery Stock (Heavy Insider Buying)
🕑 Added 2021-03-06 13:24:24 +0000 UTCHey Patreons, we are now at the point were adding some recovery stocks to our portfolio is starting to make sense, but I am not going to buy hotels and airlines, that is pure FOMO and very speculative and I may even say premature.
I am looking for recovery style stocks which are not yet hyped and are still undervalued while making sense in the post pandemic world.
On Monday I will be buying DHIL stock to add to my portfolio. Currently the price of the share as of March 6, 2021 is $156.70 and I have a price target of $180 for this stock.
DHIL is a good rotation play that makes sense, its up during the sell-off of the past couple of weeks, and it completely focuses on classic high-quality value stocks for the long term, such as Abbott, Disney and even Berkshire believe it or not. The numbers are really good as well, with a 7x P/E ratio and a 41% net margin, which is very nice. Another key factor was the fact the during 2020 we had 5% of all shares outstanding repurchased, which is a very strong indicator.
My plan is to move about 10% of my portfolio to rotation/recovery stocks during the next quarter, and this will be my first purchase as part of this strategy.
Please note that as with ANY post or video I make this is NOT financial advice and strictly my opinion and may be totally wrong. Do your own research please. Note that past performance is not a guarantee of future results. Don't assume an investment will continue to do well in the future simply because it's done well in the past.
I currently do not hold a position in this company. I will open a long position on Monday.
Comments
Siem te Hennepe
Just wondering. If you hit your price target do you sell? For example I'm a long term investor like most of us. I am 22 and looking for 10+ years. So do I sell on my target price or just hold the stocks I truly believe in like Tesla, Palantir, Disney, Shift technologies.
Shane
Gotta love this recommendation! Price target of $180 and it’s a $175 in 2 days up 12%. You are the man Tom
Tom Deschenes
That said, I can see a couple of points where it has underperformed over the past year and may be due to seeing better returns. Also a looks like it may be a cup and Handle pattern on the chart. I hope we can discuss more on Monday.
Tom Deschenes
Hi Tom, To be clear, DHIL (Diamond Hill Investment group)? I need to call out some points\questions on this. With ~15% return, which is nice, why this over $IWM (Russell 2000) or $DEEP who has 1% of DHIL? This advice would have been more attractive in Mid February (Though I know that no one can time the market).
Kas
How is this a recovery play? It's an investment in their asset management business, not in the actual assets they invest in. Lots of fund management companies dirt cheap now.
A box
DHIL, not DHL
Chate Mineer
How about CUK the sister of CCL but with a dividend.
Brett
Interesting, will read up a bit more on this
Generico Fakero
probably just adding cash, not selling
Brandon Huang
When you say “move” what current stocks are you selling to buy DHL?
Generico Fakero
DIS is very good for that purpose and I think the dip isn’t over yet
David Oliver
Interesting pick and thanks! Doing a bit of research 👍🏽
Amine REZKI
Good stock but personally I prefer Disney. Qq: Do you think the dip is over, and we are going to recover from now on ?
