For several weeks, a rotation has been underway in the U.S. market, with money moving away from some...
A Four-Pack from Fried
11/26/2004 12:00 am EST
David Friedis the only financial newsletter service to base its recommendations on corporate buybacks. His unique strategy has certainly worked; since inception in 2000, his portfolio is beating the S&P 500 by more than 123%. Here are some of his latest buys.
"Houston Exploration (THX NYSE) is
an independent North American natural gas and crude
oil producer that develops, explores, and acquires natural gas and crude oil
properties. Its operations are focused in South Texas, the Rocky Mountains, the
Arkoma Basin (in Arkansas and Oklahoma) and offshore in the shallow waters
of the Gulf of Mexico. THX reported third-quarter 2004 net income of $43
million, or $1.51 per fully diluted share, an increase of 36% from the third quarter
of 2003. Revenues for the quarter totaled $162.8 million, up 37% from the
same quarter last year. Cash from operations before changes in operating assets
and liabilities was 30% higher than the third quarter of last year, and total
daily production increased 19% year-over-year. No wonder the management of THX
has repurchased 9.6% of its net shares outstanding over the past 12
"NVR (NVR ASE) is
one of the nation's largest homebuilding and mortgage banking
companies. Its homebuilding operations include the construction and
sale of single-family detached homes, town homes, and condominium buildings
under the trade names Ryan Homes, NVHomes, and Fox Ridge Homes, primarily
in the eastern and southeastern parts of the US. In addition, NVR provides
mortgage-related services through its mortgage banking operations in 11 states.
In 2003, NVRM closed about 10,200 loans worth about $2.4 billion. NVR’s recent
earnings report was stellar. For the nine months ended September 30, 2004, revenues
rose 19% to $3.05 billion. Net income rose 25% to $364.3 million. The stock
continues to rise and the company continues to repurchase shares. They have
repurchased more than 11% of their shares during the past 12 months.
Betting against NVR has been a fool’s game.
"Yankee Candle Company (YCC NYSE) is
the leading designer, manufacturer, retailer, and wholesaler
of premium scented candles in the US. With our current national obsession with
affordable luxuries, candles and other consumable gifts are big business.
Yankee sells through a North American wholesale customer network of some
15,500 store locations, a growing base of company-owned retail stores (334 located
in 43 states), direct-mail catalogs, and its Internet Web site. Products
are available in some 180 fragrances. Success never smelled so sweet. For
the 39 weeks ended October 2, 2004, revenues rose 10% to $335.3 million. Net
income rose 16% to $34.7 million. YCC has a robust stock repurchase program as
well. Through the end of the fiscal 2004 third quarter, the company had
purchased a cumulative total of 3,027,800 shares of its common stock. For the
12-month period ending October 30, 2004, shares outstanding fell
"TXU Corp. (TXU NYSE) is a Dallas-based energy holding company engaged in power production, retail and wholesale sales of electricity and natural gas, and the transmission and distribution of electricity and natural gas, primarily in Texas. The company has more than 2.6 million electricity customers in Texas and is also among the largest purchasers of wind-generated electricity in the country. For the nine months ended September 30, 2004, revenues rose 7% to $7.18 billion. During 2004, TXU Corp. has repurchased 32 million shares of common stock, and last month the board of directors authorized the repurchase of 50 million shares of common stock. Shares outstanding have declined 7.9% over the prior 12-month period. If the new authorization to repurchase another 50 million shares is executed, shares outstanding will decline an additional 16%."
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