Ridley Inc: Why Value Investing Requires Patience RCL.TO FFH

Back in 2010, I made a quick showcase about an obscure canadian company that was purchased by FairFax Financial Holdings called Ridley Inc.

The stock has experience a huge surge since then but unfortunately I sold for very short term gains after the share price climbed from $7 to $10. Now it stands at an astonishing $25.89 after market close on May 7th 2014 as can be seen on the chart below. On top of it all the company paid $5.5 in dividends over the same period.

Did you miss out on it as well?

ICResearch Q2 2011 Performance (BKS, PHH, QCOR, VVUS, RCL, LL, ODP, EK, BBY, WFC, CREE, AIG, LOGI, PHG, WWE, NYB, LCC, CCL)

InvestingConsultantResearch.com today announced results for the quarterly performance of it's recommendations made for the second quarter of 2011. Here is how those recommendations for Q2 2011 performed since they were issued, ordered by return for the cautious investor if they had been held until market closes at the end of the second quarter of 2011 or when the bid price reached the level provided in the exit strategy.

To be fairly representative of the potential performance, the return presents what an investor would have earned opening the position at the prevailing price when the report was issued and closing it when the bid price of the stock reached the suggested exit point. If the stock did not reach any of the exit levels, the closing price at the end of the quarter is considered to be the selling price.

For the cautious investor:

BKS: + 120%

QCOR: + 85%

VVUS: + 43%

WDC: + 40%

DYAX: + 32%

CRU: + 32%

ARNA: + 30%

IGOI: + 30%

RCL: + 29%

DV: + 29%

EXF: + 27%

EXFO: + 25%

FCN: + 22%

SYNA: + 21%

AXL: + 18%

FBC: + 18%

VCI: + 18%

SANM: + 18%

MDAS: + 17%

LCC: + 17%

SWM: + 15%

FLML: + 15%

RDN: + 13%

LL: + 13%

ORN: + 12%

ODP: + 12%

EK: + 11%

MTOR: + 11%

BORN: + 10%

BBY: + 10%

JACK: + 10%

ENG: + 7%

LOJN: + 7%

PHH: + 7%

FEED: + 5%

XRTX: + 5%

SCCO: + 5%

RJET: + 4%

BPL: + 4%

WFSL: + 4%

NYB: + 4%

WFC: + 2%

FRO: + 1%

HBOS: - 1%

CREE: - 2%

PHG: - 2%

CCL: - 2%

LOGI: - 4%

LPS: - 6%

RECN: - 8%

AIG: - 9%

WWE: - 11%

SATC: - 14%

ANAD: - 20%

HSOL: - 25%

MTSN: - 26%

Average Return: + 13%

Once again, the return presents what an investor would have earned opening the position at the prevailing price of the option contract when the report was issued and closing it when the bid price of the contract reached the suggested exit point. If the stock did not reach any of the exit levels, the closing bid price at the end of the quarter is considered to be the selling price of the option contract.

For the risk taking trader:

BKS July 2011 10$ Call: + 839%

CRU June 2011 12.50$ Call: + 450%

QCOR July 2011 14$ Call: + 411%

WDC July 2011 30$ Call: + 293%

FCN June 34$ Call: + 208%

DV August 2011 50$ Call: + 174%

RCL June 2011 42$ Put: + 160%

BBY June 2011 30$ Call: + 159%

VVUS June 2011 7$ Call: + 145%

VCI June 2011 27.50$ Call: + 130%

MDAS June 2011 15$ Call: + 109%

AXL July 2011 12$ Call: + 83%

SYNA September 2011 26$ Call: + 67%

ARNA July 2011 1$ Call: + 62%

LL August 25$ Call: + 59%

SWM June 55$ Call: + 59%

BPL August 2011 65$ Call: + 55%

ODP September 2011 4.50 Call: + 50%

SANM June 2011 11$ Call: + 49%

ORN June 2011 10$ Call: + 45%

JACK June 22.50 Call: + 42%

RDN August 6$ Call: + 42%

DYAX August 2011 2.50$ Call: + 40%

NYB July 2011 17$ Call: + 40%

EK July 2011 3.50$ Put: + 38%

WFC July 30$ Call: + 32%

MTOR August 17$ Call: + 29%

CREE September 2011 42.50 Call: + 22%

ANAD July 5$ Call: + 20%

WWE July 2011 12.50$ Call: + 20%

SCCO June 2011 36$ Call: + 12%

FLML September 2011 7.5$ Call: + 9%

PHH August 2011 22.50$ Call: + 7%

LCC June 2011 9$ Call: + 7%

SATC June 2011 2.50$ Call: + 2%

HSOL June 2011 7$ Call: + 0%

ENG June 2011 5$ Call: + 0%

RJET August 2011 7.5$ Call: + 0%

LOGI September 2011 15$ Call: - 9%

AIG May 2011 37$ Call: - 12%

BORN September 2011 10$ Call: - 13%

PHG July 2011 30$ Call: - 14%

FRO August 2011 23$ Call: - 16%

FEED August 2011 2$ Call: - 20%

CCL June 2011 40$ Call: - 31%

MTSN June 2011 2.50$ Call: - 33%

XRTX August 2011 10$ Call: - 35%

RECN August 2011 17.50$ Call: - 35%

LPS June 2011 31$ Call: - 63%

LOJN June 2011 5$ Call: - 67%

IGOI June 2011 2.50$ Call: - 77%

WFSL July 2011 17.50$ Call: - 88%

Average Return: + 66%

Most of InvestingConsultantResearch.com's picks returned modest performance and some even suffered losses, but the losses were offset by the provided exit strategy. Subscribe to our our site to stay informed for forthcoming recommendations for Q3 and Q4 2011 or follow us on Twitter.

Royal Caribbean Cruises Ltd (NYSE: RCL) Q2 2011 Price Target

Recent price: 43.55$

P/E Ratio: 17.28

3 Months Target Price: 39$

Company Description

Royal Caribbean Cruises Ltd. is the world’s second largest cruise company, operating the Royal Caribbean International, Celebrity Cruises, Pullmantur, Azamara Club Cruises and CDF Croisieres de France brands, with 40 ships and a passenger capacity of approximately 92,300, and TUI Cruises through a 50% joint venture.

These brands offer an array of onboard activities, services and amenities, including simulated surfing, swimming pools, sun decks, beauty salons, exercise and spa facilities, ice skating rinks, in-line skating, basketball courts, rock climbing walls, miniature golf courses, gaming facilities, lounges, bars, Las Vegas-style entertainment, cinemas and Royal Promenades, which include interior shopping, dining and an entertainment boulevard.

The company will introduce two more ships by the end of 2012. The current ships operate worldwide with a selection of itineraries that call on approximately 400 destinations.

Confidence Margins

Strong resistance $49.96 (-15%)

Light resistance $45 (-3%)

Light support $39.73 (+9%)

Strong support $32.85 (25%)

Recommendation

Even if the company is doing pretty well financially, it seems that the recent rise in the price of crude oil will have adverse effects on the future performance of the company. It is pretty clear that this scenario will have a negative impact on the performance of the stock price at least until energy prices stabilize.

Entry strategy

For the cautious investor:

Sell short the stock for 42$ or more.

For the risk-taking trader:

The June 2011 42$ out-of-the-money put option contract seems to be the right position to take, they can be acquired for about 335$ per contract.

Exit Strategy

For the cautious investor:

Buy to cover when the stock reaches 39$, or keep it until 33$ if you are more bullish in your own analysis. It is highly recommended to keep the position on check if it goes sour as a favorable upside market movement could have devastating consequences.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 39$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.