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Media General Gets Acquired!

Media General Gets Acquired!

By: Mark Gomes, CEO

Long-time followers know one thing about my picks — patience pays.

On Thursday, (after I had sent this week’s PTT Insider into publication and left for vacation) big news broke on one of our picks. Those of you who have been invested in our 2013 Russell 2000 selections received a special reward for your patience — Media General (MEG) announced a merger agreement in which it will effectively be acquired by privately-held New Young Broadcasting.

This one was definitely a test of patience. At one point, the stock was over $10 and up 85% from our March initiation price of $5.50. After that, the stock inexplicably went into free fall, dropping nearly 30% in recent weeks (reminiscent of the action in PXLW this week). However, yesterday’s announcement wiped out most of MEG’s pullback, rising 24% on the day.

It’s giving back some of those gains this morning, but is unlikely to fluctuate much from current levels. As a result, our 2013 R2K portfolio has been thrust into great position to break our 2011 record. Here’s where we stand to date:

Company

Ticker

Date

Position

Initial Price

Current Price

Current Return

Peak Return

Media General

MEG

3/17/13

Long

5.50

9.06

65%

85%

Perfumania

PERF

3/17/13

Short

5.91

5.78

2%

11%

PDI, Inc

PDII

3/24/13

Short

6.08

4.61

24%

37%

LCNB Corp

LCNB

4/14/13

Long

16.98

18.05

6%

13%

Palmetto Bancshares

PLMT

4/25/13

Long

11.98

13.95

16%

33%

Averages

23%

36%

Unofficial picks for R2K inclusion are:  NEO, UCFC, UNXL, and VRNG.
Unofficial picks for R2K deletion are: BERK.
Source: PoisedToTriple.com

 

With an average holding period of just two months, this year’s picks are up an average of 23%. Our longs are up 29% and have risen as much as 44%. Our shorts have also done well, falling 13% (with a peak return of 24%) despite bullish market conditions. Both of our short picks have gone down, producing a profit for investors (and a perfect 5-for-5 record on our 2013 R2K selections).

At this point, we’re not making any new official changes to the Russell portfolio. However, I have personally initiated short positions on BERK and UCFC. I believe that both have a good shot at falling 10% in the coming weeks. Thus, I view them as good insurance policy against a continued market decline.

What’s Next?

First of all, I’m getting back to my vacation. I’ll be authoring next week’s Insider (a PTT Portfolio Update) from somewhere in California. After a few days in Texas, I’ll be back in the office on the 17th and putting the wraps on our next picks to triple.  If you are not subscribed yet to the PTT Insider, you can do so here.

Speaking of which, four companies have simultaneously made it past our rigid screening process (typically, we only find 6 potential triples in an entire year). Based on past experience, at least two of them should make it past our final screening and become Poised To Triple picks. I’ll be sure to consult the charts, so everyone has a chance to get in at attractive levels. Not all of our picks go up right from the start, but we do our best. We’ll be trying extra hard in the coming weeks.

Stay Tuned…




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PTTResearch.comPoisedToTriple.comWallStreetForensics.comSolarStockIdeas.com, PTTAlpha.com and The PTT Insider are property of PTT Capital, LLC. This information is confidential and for the information of the addressee only, and may not be reproduced, in whole or in part, copies made or circulated, or disclosed by the addressee to another party, without the prior written consent of PTT Capital, LLC. Our content should not be consumed without reviewing our latest Methodology, which discloses our investment philosophy and trading practices. Mark Gomes' Methodology is subject to updating, but publicly available at PoisedToTriple.com or upon written request. Information and opinions presented herein has been compiled from sources believed to be reliable, but PTT Capital, LLC makes no representation at their accuracy or completeness. This communication reflects PTT Capital, LLC’s opinion as to the securities mentioned herein, but is neither an offer to sell nor a solicitation to buy them. Copyright 2014 PTT Capital, LLC. All rights reserved. Past performance does not indicate or guarantee future results.

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