Wednesday, March 17, 2010

Just Go With It

As many have said, and most of us have felt, the market feels like its at a short-term top.  But I've learned to know better and markets can continue to run (or fall) much longer than we all think possible.  Many businesses are continuing to show improvement, and still more are being priced for it.

I still think there are more and more individual investors coming out of the woodwork as they regain confidence in the market, and that will continue, especially in a low-volatility, but upward moving market.  The yields on cash are just too low.  People are going to go after a better return, and the stock market is the best spot for that right now.  So while I know we're due for a correction, I wouldn't be surprised if we don't see a large one.

My small cap stocks continue to run, and I'll continue to add to my positions if opportunities present themselves. Specifically Jamba (JMBA) and iGo (IGOI).

TII Network Technologies (TIII) reported earnings this morning, and after a quick glance, they look pretty solid.  Gradual improvement, and better results due to cost cutting.  By the way, its awfully late to report Q4 earnings.  Q1 is almost over!  These small cap names with a lot of cash on hand have been doing well lately.  Even if operations don't improve dramatically, you're likely to see some gains as valuations return to more normal levels as the economy picks up.

Dr. Pepper Snapple (DPS) got an upgrade last week, and an analyst noted that they're likely to enter into a bottling deal with Coke, much like the Pepsi deal.  I missed my entry on that stock, and I'll buy it if it pulls back. I'm still a little surprised it hasn't taken any kind of a hit due to the threat of a soda tax.  I'll continue to keep an eye on that.

Disclosure: Long JMBA, IGOI, TIII

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