Tuesday, June 11, 2019
Cutting my flowers and watering my weeds? (ZM, SQM)
I bought Zoom (ZM) about a month ago (4.23.19) and it's already up 50%. I know the old adage is ride your winners but yesterday ZM was trading at a valuation of over 60x sales, which is, to be technical, full-throttle nuts. So I sold my gain, so far, leaving me with my original investment.
What to do with the the money?
I was SO tempted to spend it on SQM, which is a lithium play that is currently paying a forward dividend of EIGHT PERCENT, but I hesitated because A) I just bought more SQM and B) the total loss that was Cable and Wireless, also a dividend play, still makes me fearful.
But, but, but... SQM is profitable! And electric cars are inevitable in the next 3 to 5 years, a fact that should materially increase the demand for lithium! And Simply Wall Street says SQM is trading for 66% LESS than future cash flow.
Argh.
So.
Tempting.
Mulling...
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