We know it's a tiresome cliche and everything, but it might have been a good idea for us to sell in May. And then go to the beach until September.
The S&P 500 is down almost 3% since May 1, but it feels a lot worse than that. Maybe it feels that way because one of our favorite portfolio holdings, MAKO Surgical (NAS: MAKO) , is down 41% since the beginning of May, and its CEO didn't even lie on his resume. Another of our favorites, InvenSense (NAS: INVN) , is down 26%. Can't a couple of stock-pickers get a break?
Fortunately, investing performance isn't determined by how you do on a couple of picks over a couple of weeks. In fact, the big takeaway for us is that two fantastic businesses are now considerably cheaper because of the short-term thinking of the market. As long-term investors, we're actually happy for the opportunity. Thank you, May!
Let's look at some more of the top stories of the week, along with takeaways for our 10-Bagger Portfolio:
The post office loses $3.2 billion
We learned just yesterday that the U.S. Post Office lost $3.2 billion during its most recent quarter and that it may run out of cash by October. This is the 10th consecutive quarter of losses for the Post Office, which seems unable to cope with some of the massive technological and social changes in recent years.
Takeaway: Famed short-seller Jim Chanos likes to bet against obsolete businesses and technologies. We take the opposite approach. We like to invest in the companies that are disrupting the norm and moving the world forward. That's why we've invested in LinkedIn (NYS: LNKD) , the professional network that is transforming the career-management space.
Facebook acknowledges challenges in mobile
Facebook is apparently mortal after all. The company announced that more than half of its 900 million users access its mobile site. It also admitted that higher usage on mobile devices in the future "may negatively affect" financial results. It seems Facebook is still figuring out how to manage the growing mobile trend.
Takeaway: During the Gold Rush in California, enterprising businessmen made money selling picks and shovels to prospectors arriving in search of their fortunes. In the mobile rush, we prefer "pick and shovel" providers Apple (NAS: AAPL) and Google, which supply devices and operating systems. They're the ones driving the mobile trend, and that's why we invested in them.
Earnings season has been brutal for some companies
We already mentioned that MAKO Surgical is down considerably in May. Its recent earnings disappointed some investors, and its shares fell more than 30% in one day. Watchmaker Fossil saw its shares plunge almost 40% after a similarly disappointing earnings announcement. And then there's Green Mountain Coffee Roasters (NYS: GMCR) , which saw its shares fall 47% in just one day after announcing weak guidance. Green Mountain investors probably need something a bit stronger than coffee after what they've had to endure over the past week or so.
Takeaway: No one likes to see his stocks go down. OK, short-sellers do, but most ordinary investors don't. But after a fall, what we like to do is take the new information, compare it with our long-term thesis, and then decide whether the thesis is broken or still intact. If it's broken, we'll sell. If it's not, our choices are to hold or buy more. We'll be announcing our thoughts on MAKO Surgical and InvenSense very shortly.
That's all for this week, Fools! Don't forget to follow us at @TenBaggers on Twitter for all of the latest information relating to the portfolio. And don't forget to add each of these companies mentioned to your personalized version of My Watchlist so you can track them and monitor their progress.
At the time thisarticle was published John Reeves owns shares of Apple and Google. David Meier owns shares of Apple. The Motley Fool owns shares of LinkedIn, InvenSense, Apple, Google, and MAKO Surgical.Motley Fool newsletter serviceshave recommended buying shares of Google, MAKO Surgical, Green Mountain Coffee Roasters, Apple, and LinkedIn, creating a lurking gator position in Green Mountain Coffee Roasters, and creating a bull call spread position in Apple. The Motley Fool has adisclosure policy.We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
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