Just wanted to call attention to this former Saul holding (which he picked up well before the RB rec) has been doing very well, bucking recent market trends.
ELLI took a breather Aug 2012 -Aug 2014, bouncing around in the 20s, but has climbed to from $25 $37 in the last 6 months.
Glad I still hold some. Wish I hadn’t had some called away at $30 in September.
-Brandon
Just wanted to call attention to this former Saul holding (which he picked up well before the RB rec) has been doing very well, bucking recent market trends. ELLI took a breather Aug 2012 -Aug 2014, bouncing around in the 20s, but has climbed to from $25 $37 in the last 6 months.
Hi Brandon, I rode Elli from about 5 to 28, in July 2012, when it went straight up, then I guess I lost patience during that 2 year period where it went absolutely nowhere. Their platform was great, but I guess what did me in was that each quarter they’d say that their extra expenses were about finished and they would start growing again next quarter, or the quarter after that, and it never seemed to happen. Teaches me a lesson about patience, which I tend to lack.
Saul
Saul
Teaches me a lesson about patience, which I tend to lack
I think your impatience is your key to success. I have made the mistake of hanging around too along in hope when things are not going right. I still do it, but trying to learn to let go of things gone wrong.
Occasionally some would bounce back but you will also avoid a number of costly mistakes.
I love the MF boards for the wealth of information, without it I don’t think I would be a member. But one of the flaws of the board and also TMF I feel is most members err on the side of optimism and hope, even in the face of growing evidence. It is the managements job to paint a rosy tomorrow, and it is the investors job to discern the wheat from the chaff. The tendency on the boards and Motley Fool is usually is to trust the management, till it usually is too late. Also it is hard to let go off your own pet thesis and ideas.
Swapsan
I feel is most members err on the side of optimism and hope
The other factor, I think, is that a person will get interested in a company, dive in to do some analysis, and if they like what they see, they post about it leading to a little flurry of discussion which brings it to the attention of a wider group. But, some time later the original champion may become disillusioned or at least tempered enough in his or her enthusiasm, so that the stock gets sold and the company no longer watched. People are far less likely to post about that, so, if you are one of those who got excited by proxy, you have no awareness that the original champion has left the field or why.
Brandon,
FWIW, I have held ELLI for a while myself. Following some of Saul’s protocol, here is my ELLI story over the past couple days.
I truly thought their report would be good but make statements of caution regarding the near term outlook. I looked at their PE, it was over 110 yesterday. Earnings report to be announced after close yesterday. I had gotten in with fresh investment at the bottom back in April and was holding nearly a 60% gain.
Using the ‘Saulocratic’ analysis and action methods, I sold yesterday at the high (and put the money into the promising BOFI that has been clawing back from unreasonable recent lows and a PE under 20).
This blind hog, sniffing out the trail that Saul left) found an acorn! I avoided the 10-12% haircut on ELLI and enjoyed the 4-5% rise in BOFI, as of now in today’s market.
Cool Story, Bro?
KLVanLiew
I really like this post. I’ve always found ‘buy low sell high’ to be a vexing piece of advice. But ‘sell after excessive appreciation and use the funds to buy under-appreciated stocks’, which is what you’ve done here, is more specific and easier advice to follow. Similarly, I hope, I just sold some LNKD today and bought INBK.
I avoided the 10-12% haircut on ELLI
vanliew,
When was the 10-12% haircut? Must have been intraday since I’m looking at about a 2% haircut.
Wishing I’d seen the 10% discount,
Pete
Just talking about Elli. Yes it has a high PE and the initial response to the earning report was very negative, mostly due to EPS guidance and planned heavy investment Q4 and 2015.
But by looking under the hood, its business is quite strong and is getting on momentum. Their numbers on number users, revenue per user went up nicely and they saw a consistently rising trend of more transactions per application.
The macro environment potentially can help Elli’s business in 2015 and beyond as job picture getting stronger, GDP stays around 3%, and price at gas pump stays low. This will eventually bring about a stronger housing market.
Additionally mortgage regulations are not getting simpler anytime soon. Lenders are flocking to service provers like ELLI as most lenders do not want to build and maintain a rule engine and become a tech company.
Much of the investment is towards getting and keeping enterprise level customers. They signed up 4 in Q3, including one of the top 20 lenders with well over 400 seats.
I would have bought more in the morning if I had cash.
-M
Pete,
It was right out of the gates, even dropped to a low of $31.05/share, down $8+ and nearly 20%! Honestly, toyed with jumping back in with fresh money, (i am ignorant of “wash rules”, would that be a problem in such a scenario?) because the growth story is still very compelling albeit expensive from a PE view. I would have rode ELLI’s intraday tide to a ±10% gain. But alas…
KLVanLiew
-M,
I agree. I think ELLI has growth and momentum on its side. I just thought “there’s a hit coming”. Turns out this time I was right. However, in dodging the right hook I got nailed by the left uppercut. I almost jumped back in this morning, thinking “this business is strong and will be stronger, lets ride the price back up”. But I did not. My position was not very large, so I sold all. If I had kept a few shares, the re-taking of the position would have been more natural. I will be watching and hoping for re-entry.
Now, to tame the trading beast and release the LTBH tortoise,
KLVanLiew
Short-term tax gains is part of what keeps me from trying to do what you did today KL. I hope it works out for you. I think BOFI and ELLI will both do well.
Definitely some interesting intra-day price action on ELLI today.
I plan to sell monthly puts until I get assigned the shares that were called away. Right now I’ve got a Nov $35.
-Brandon