OIG Valentine’s Day

Dear all,

Thanks for coming to OIG’s weekly meeting on Valentine’s Day. All the single ladies rock!!:) (and non-singles alike.)

We kicked off with an introduction of futures. Future is a riskier investment option than options. For details, please consult investopedia.

Yufan did a great market re-cap. She introduced us to Boston Beer Company(SAM). After selling EROC, we have been thinking for a really long time to buy a new stock. Yufan backs this stock on several grounds.

  • Successfully withstood the financial crisis
  • Has no debt or obligations to service, which is a huge plus
  • International market presence and great earning forecast

However, our members also voiced out some concerns about SAM:

  • Price too high (running at 94 at the time of decision)
  • PE much higher than industrial average or major competitors (29+)
  • Earnings report will be released pretty soon by the end of March

As usual, we held a vote, and reached a consensus of buying 30 shares of it at $90. If you have any questions or concerns about this stock, please contact Yufan.

P.S. Our club donation is coming out soon. It is operated on a first come first served basis. If you or your club want to get OIG funding, you will need to be the first 5 people to submit a proposal to our publicity chair Sophia Abboud. Look out for Sophia’s email.

It is the annual hell week’s time for Bryn Mawrtyrs. Enjoy this special time of the year with your heller (or hellee)!

News of the week–Feb 1-Feb 7

The following information was compiled by Yufan Wang, Portfolio Manager of Owl Investment Group. Hopefully it will give you girls/guys some idea on how the stock market will move.

  • Sysco released earning today, missing analysts’ estimates. Share tumbled 6.2%;
  • Governors Chop Spending;
  • AOL to Acquire Huffington Post for $315 million;
  • Nokia, under new CEO, prepares to freshen its executive ranks;
  • Bonds Flash an Inflation Alert;
  • China begins to stockpile Rare-Earth Metals;
  • No Rush to Hire Even as Profits Soar;

A heads-up for Mawrtyrs:  There will be an interesting Career Lab Series hosted by Forte Foundation.

Feb 24th, 2011

Tired of the old “bored” room and old-school business? Join Forté’s 2011 Career Lab to explore how business knowledge can enhance your academic background, professional ambitions, and social or service interests, and can help you segue into an exciting and opportunity-rich career. Accomplished women from Forté Foundation sponsor companies and schools will reveal the new world of business and help you envision your role in it.

Who Should Attend? All undergraduate women who dream of a fun and successful business careers, regardless of major. Liberal Arts, Engineering, all majors welcome. Cost? Free

Register today @ www.fortefoundation.org/careerlab

¡

EROC SOLD–OIG Feb 8th

Today we sold our 210 shares of Eagle Rock Energy Partners LP (EROC) with a stellar 94% profit after holding the stock for a whole year.

Yufan executed the sale in front us on the computer screen in Taylor F. It was gratifying to take this step forward and cash in some fruits of our labor. :) All of our members present consented to this sale.

EROC is a domestically focused energy company in the business of natural gas. It has been making negative earnings for two years except for two quarters last year. We had looked at this stock before winter but decided to postpone the sale because natural gas prices generally rise during winter, which is a good sign for companies like EROC.

Our rationale for selling it:

  • Disappointing earnings: Stocks like EROC can’t go up forever without the support of strong earnings.
  • We are lucky to get a 94% increase in price already, far exceeding our original selling benchmark of 65%.
  • It’s time for us to diversify our portfolio and invest in other stocks.

Because of time limits, we didn’t look into other stocks today. But one sector to look into is rare-earth. China has been setting up export quotas for its rare-earth resources. As a result, US companies have increased their production, making it a good time to look into this revived industry.

Other than EROC, Ruilin introduced to us the concept of Options. According to Investopedia, the definition of an option is: A contract that gives the buyer the right, but not the obligation, to buy or sell an asset at a specific price on or before a certain date. An option, just like a stock or bond, is a security. It is also a binding contract with strictly defined terms and properties.

One more thing: Forte Foundation’s Career Lab is taking place on campus soon. Please make sure to check your mailbox and RSVP soon if you are interested. This is a free event and will expose you to a myriad of information related to business.