Cody Kiss & Tell: Busted shift-key, ex-dividend, and lots o’ stocks

Howdy folks, let’s ride.

Q. When a company announces their earnings for the quarter and they announce a dividend with it. Like when Apple announced, “The dividend is payable on November 13, 2014, to shareholders of record as of the close of business on November 10, 2014.” If I were to buy shares of the company on November 9, would I get these dividends? And then be able to turn around and sell it on the 14th?

A. The short answer to your question about getting the dividends is that you’d probably want to make sure you were a shareholder of record even a couple days before November 9 to make sure the trades have settled and what not.

Comment:You need to see what the shareholders of record date is. As long as you own before that date you will receive the dividend.

Eryba: However Cody is RT don’t want to cut it too close in case for WHATEVER reason shares haven’t settled. So earlier the better.

Q. It seems like one could just hop in and out of companies just for dividends. Is this a thing?

A. Traders have for years tried to figure out how to successfully consistently trade around dividends like you’re suggesting, but the stock’s often drop a bit to reflect the dividend and sometimes just trades wildly for whatever other reason, so I don’t think there’s a good arbitrage/trading opportunity around dividends in general as you are asking.

Comment: Be aware that technically the price will be adjusted down on the day the stock trades x-div. This may be masked by other factors impacting the share price on that day.

Q. Do you have any thoughts / interest on $AMD? Long term hold?

A. Let’s look at $AMD for a second together and see what we come up with. The company’s balance sheet is wrecked with billions in debt and little cash. http://www.scutify.com/company-balance-sheet.html?ticker=AMD Balance sheet concerns alone will stop me before I go any further, but let’s continue. $AMD’s burning cash fast too, not creating cash flow. http://www.scutify.com/company-cash-flow.html?ticker=AMD. And revenues are growing less than 5% per year and are expected to be down next year. I’d call that a sell, I suppose. Good luck.

Q. Hi Cody, how do you see the real estate market reacting if/when this bubble blowing bull market does end? Thanks.

A. Good question, but I don’t think there’s much reason to believe that real estate will be all that directly correlated to stock market prices in coming years, as it hasn’t really been very correlated over the long-term. I was a huge real estate bull in the depths of the collapse back in 2009-2011. But I am less so as prices are now stabilized at much higher levels nationally and wildly up in some areas where I was suggesting a bottom was being put in like in Las Vegas and Miami back when I was a real estate buyer and bull.

Q. Hi, what do you think about the market at this point?

A. Feet-to-fire, I’d say the path of least resistance for the markets will be a wide range between 15,900 and 17,000 on the DJIA for the next few weeks. I’m not trying to game that action though.

Q. Questions concerning $HIMX.

A. $HIMX is my second smallest position and I’ve been blunt and repetitive in describing it as a wildly volatile stock. If I thought there was something meaningful we should be doing with $HIMX, I would immediately let all TWC subscribers know first and foremost before anybody else. Google investing more yet again in the company’s display division doesn’t change my analysis about why I scaled into some even below these current levels many weeks ago and I don’t want to add to it yet either. So steady as she goes for me despite the wild volatility, as expected, in HIMX shares.

Q. Scott Rothbort, who writes a restaurant stock newsletter, said when I asked him about Sonic and Whole Foods: October 22, 2014 – 1:32 PM $SONC has always been a poorly managed company but getting better. It has successfully moved North but it is too expensive to buy as an investment but I do not see a catalyst which would make it a short. Scott October 22, 2014 – 1:33 PM $WFM is still way too overpriced given that growth is slowing an competition will squeeze their margins. It sell for great than 2 PEG which is a warning sign.

A. I love Scott but I don’t use necessarily agree with his analysis or approach. Indeed, I flagged MCD the same way at the top in a similar vein to what I’m trying to do with $SONC now and I don’t think Scott is getting just how huge the trend against pink-slime and cheap greasy food is kicking in.

Cody: BTW, according to my calculations, $SONC trades at 4 PEG vs the WFM PEG of 2.

Cody: PS. I’m just taking the topline growth rate for each company ($SONC ~5%, $WFM ~11%) and taking the P/E ($SONC ~25, $WFM ~20). So actually that gives $SONC a 5 PEG? Doh, I might have to add to a second tranche in that one sooner off this pop today rather than later.

Q. Would you let us know when you add a second tranche in $SONC?

A. TradingWithCody subscribers get an article and an email every time I make any trade, and that will definitely include the next time I tranche into $SONC.

Q. Cody how is the new TWC site coming any release date?

A. We have most of the new TWC site ready to go and it’s pretty awesome. But, Kheang wants to move it onto a new flash-drive server system that will be make it even faster than most any site on the net before he turns it on. That new server update has taken longer than expected, so it’s bottlenecked the rest of the process.

Q. Any thoughts on Marcins new pick for 2015 of $RFMD ?

A. I was just working on $RFMD this morning. Not done yet, but it looks very interesting and as you know, I have huge respect for Marcin’s stock picks.

Q. What about $APOL. Not a particularly great report, but the stock is hanging in there, growing lately, etc. I cashed out on my shorts (there’s a phrase for you) a while ago and made some money — but with what you see, would you say it’s worth re-shorting at this level?

A. I think $APOL is hanging on by a thread and I am considering even buying some longer-dated puts on it to get some exposure to its next few quarters’ worth of declining enrollment. Apollo’s University of Phoenix has wasted billions of taxpayer and under-educated people’s money and it’s time for the University of Phoenix to get shut down completely. The risk is that their lobbyists continue to make enough waves to keep enough of your RepublicanDemocratRegime’s sell-outs to keep sending the welfare money and students to Phoenix. Makes me sick when I analyze the modern-day “for-profit” welfare-built “school.” @(*&@#*&!

Q. Re $APOL: I’m in total agreement. Would you say you’re close to describing which long-term puts? Are there any out there without a huge premium and a long enough term? And/or, to avoid severe risk, it sounds like you’re saying it’s a good short right now?

A. Not ready to pull any triggers on $APOL puts yet. I still have it as a short position via common stocks that we put on back when it was double the current price, and I think it’s still/again a great short idea.

Cody: I guess I’m gonna make me a sammich in the middle of this chat. I got caught up on the Qs for now. Ask me anything folks!

Q. And another Q: what kind of sammich?

A. If I were to take the time, I’d make a ham/pepperoni/mustard/pickle/lettuce/tomato/pepperoncini/salt/pepper using premium ingredients on some sort of toasted bread with some (sorry to admit) Nacho Cheese Doritos and a Sprite. But I’ll probably have some ham and cheese on bread and a carrot and a celery and some granola instead.

Comment: Do us all a favor and buy all of that stuff (except the Doritos and Sprite) at Whole Foods Market. If they even exist ‘mongst those ranches in NM.

Cody: I used to shop at the Whole Foods across the street from my last apartment in NYC in Tribeca. Got my own garden and got a whole side of a ranch cow in the freezer, and got a few good smaller grocery stores in Ruidoso, including my brother-in-law’s Mario’s Market.

Q. Also re $FB, (1) What are your expectations for $FB with earnings next Tuesday? (2) Better yet, what is the market expectation (if you know) for $FB into earnings next Tuesday?

A. Market expects big things from $FB earnings report next week. So do I. Will it be enough to pop the stock or will the stock take a hit after the report? Sheesh, let’s see how it trades before now and next Tuesday night when the report hits. Longer-term, all systems go on $FB as a must-own.

Comment: Thanks Cody; I asked now (in part) because the report will be out before the next Q&A.

Cody: Yes, fair point about the timing on $FB’s earnings vs the Live Q&A Chat next week.

Q. Cody, as idea… I have been analyzing on substitute $SNDK for $MU in my portfolio since MU looks much cheaper in terms of PE than $SDNK and also $MU looks in very nice position in the DRAN and NAND market. What do you think?

A. I like $MU but I think $SNDK will prove to be the more profitable of the two over the next decade. Both give you exposure to Flash, which is taking share from disk-drive, in addition to being in secular growth mode. DRAM doesn’t have the market-share taking kicker that Flash does.

Q. Hey, M asked Mooshy to ask you, but since we have time, I’ll save her the trouble: what ever happened to your weekly report of actual trades, with buy/sell prices, details on options , etc. ? I know I, and many others, found it quite instructive and a valuable part of the membership. It seems just to have stopped.

A. I don’t have any one to do the administration of that weekly compilation of my trades right now, but I’ll train someone to do it and start doing that again after we get through turning on the new TWC site.

Q. Cody, The mining stocks continue to be very out of favor, almost loathed. Even with the price of gold up about $50 from the recent low around $1,190 the miners seem to have no support.

A. Market is saying that the gold miners aren’t profitable enough below $1300/oz to be a good trade/investment. I have been patiently waiting to get back into a miner or two, but it doesn’t look like it’s going to be anytime soon frankly.

Cody: I just broke the left Shift-key button on MacBookPro — it’s cracked in half. I use the left Shift-key button as I type a lot more than I do the right one for some reason. Incredible how many times I must have hit that left Shift-key over the last three years that I’ve been using this laptop as my primary computer.

Comment: Whoa — I totally forgot there even IS a right Shift-key button. Mine also says “Pause,” whatever that means. Maybe it’s for when you’re eating sammiches.

Cody: Haha, yea. And I’m now re-learning what my first typing teacher taught me when my parents made my brother and me take private typing lessons when we were little kids so that we’d learn the fundamentals — using the right Shift-key when trying to capitalize a letter from the left hand side of the keyboard.

Q. Hey C.W, thanks for everything. Feet to fire on $FB?

A. See above – Market expects big things from $FB earnings report next week. So do I. Will it be enough to pop the stock or will the stock take a hit after the report? Sheesh, let’s see how it trades before now and next Tuesday night when the report hits. Longer-term, all systems go on $FB as a must-own.

Q. I was away from my computer this morning in Estes Park, CO so I didn’t see your email re: trimming $AMBA until 90 minutes after you posted it. In that 90 minutes $AMBA had dropped $1.30 per share, approx 3%. First, I congratulate you on being so precise on your timing. Second, what is your mojo for hitting the top of the price range?

A. Luck? Gut? Art? Catching a bottom or a top isn’t ever what I’m ever actually trying to do. Just trying to take the pitches as they come and be disciplined in my approach.

Q. Where can I get a simple explanation of how the 3x reverse EFTs, e.g., $NUGT, $JNUG work? How does lower prices of a bundle of mining stocks convert to a fund that tracks 3x the movement?

A. I’m not a big ETF fan, as you know, and I’m definitely not an expert in how the 3x reverse ETFs work, nor do I have any desire to be.

Cody: Okay folks, that’s a wrap, as I hobble through these last answers with a busted keyboard.