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Monday, October 22, 2007

LDK Solar (LDK) Up 16%, I am Cutting Back a Bit and Pushing Into Mosaic (MOS)

Posted by Mark at 1:14 PM TweetThis
I am selling 200 of the 1250 shares of LDK Solar (LDK) as the stock has raced out to a 16% gain today. What a roller coaster. I am basically flat on these shares that I am selling, and am simply reducing exposure plus raising some cash since my wallet is empty. LDK Solar signed yet another contract today in a seemingly endless supply of contracts. If everything turns out well as I assume it will - even the "worst" news on the inventory front will be a short term issue - this stock should be significantly higher in a year so buying at $40 or $50 won't matter too much for where it can potentially go once this dark cloud is lifted from overhead. For now, I just want to reduce some exposure as the volatility of late is more in tune for a daytrader instead of me. This reduces the fund's exposure from 4.4% (as the stock rose 16% today it became a larger part of the fund), to 3.7%; still a major holding.

With these funds I bought more Mosaic (MOS) on it's 5% pullback today. While LDK Solar has more home run potential here, I see a sure .300 batting average in Mosaic...

Long LDK Solar, Mosaic in fund; long Mosaic in personal account

Posted by Mark at 1:14 PM Comments (2) | Edit This Post | Create A New Post

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2 comments:

Anonymous said...

They'll only be higher if they are actually making money.

People don't seem to understand that over-stating the inventory means that the company may actually be operating at a loss rather than the currently stated positive margins.

October 22, 2007 8:25 PM  
TraderMark said...

True enough, but its a question of degree. If they were running at 19% margins then you might say they might truly be at 9% margins - they were saying mid 30%s so my assumption is worst case they are low to mid 20%s and the fact they are in an area (for the next 18-24 mo) at least with the highest demand (i.e. arms merchant) that would be suitable considering the amount of contracts they are signing literally on a weekly basis. With that said, until the news is out there is still a dark cloud - I keep saying BAD news is better than UNCERTAINTY. Right now we have uncertainty.

October 23, 2007 9:31 AM  

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