Exelon
QLogic
Dendreon
Dell
Staples
Arkansas Best
Arch Coal
Skullcandy
Orange
Xerox
Now, let’s get to the portfolio and see how it fared this week:
| Company | Cost Basis | Shares | Total Value | Return |
|---|---|---|---|---|
| Exelon | $31.25 | 31.68 | $969.09 | (2.1%) |
| QLogic | $11.46 | 86.39 | $952.02 | (3.8%) |
| Dendreon | $5.97 | 165.82 | $761.11 | (23.1%) |
| Dell | $13.37 | 74.05 | $937.47 | (5.3%) |
| Staples | $13.48 | 73.44 | $1,249.95 | 26.3% |
| Arkansas Best | $10.83 | 91.41 | $1,983.60 | 100.4% |
| Arch Coal | $7.03 | 140.83 | $549.24 | (44.5%) |
| Skullcandy | $6.71 | 147.54 | $814.42 | (17.7%) |
| Orange | $11.64 | 85.05 | $837.74 | (15.4%) |
| Xerox | $8.16 | 121.32 | $1,176.80 | 18.9% |
| Cash | $0.06 | |||
| Dividends receivable | $99.26 | |||
| Total commission | ($100.00) | |||
| Original investment | $10,000.00 | |||
| S&P 500 performance | 12.2% | |||
| Performance relative to S&P 500 | (8.9%) |
Source: Yahoo! Finance.
This week’s winner
Topping the list of gainers this week was biotech firm Dendreon Corporation (NASDAQ:DNDN), up 3.8%, which, if you recall, was the worst performer in the previous long week. Although no company-specific news drove shares higher, anticipation from bulls must be building that, with a favorable opinion of Provenge from the European Medicines Agency’s panel, an approval might be right around the corner in Europe. It may not get Dendreon Corporation (NASDAQ:DNDN) to profitability anytime soon, but an EMA approval is a must if Dendreon Corporation (NASDAQ:DNDN) is going to be a successful company and perhaps draw the attention of a larger rival.
This week’s loser
Once again getting this week’s dubious award for worst performer is no stranger to the category, Arch Coal Inc (NYSE:ACI). It’s ironic, as well, that the best and worst performers from last week swapped places this week! Arch Coal Inc (NYSE:ACI)’s 6.5% tumble has everything to do with its second-quarter earnings results, which showed a 21% decline in revenue, to $766 million, despite a narrower adjusted loss of just $0.29 per share. Comparatively, the loss was $0.05 per share less than the Street expected, but revenue fell about $153 million short of estimates. Arch Coal Inc (NYSE:ACI) plans to focus on cost-cutting through the remainder of 2013 until pricing improves, and I’ll be looking forward to see if it can diversify its revenue stream meaningfully through its exports.
Also in the news…
In this week’s episode of “Dell Inc. (NASDAQ:DELL)‘s of our Lives,” we learned that the buyout offer by Michael Dell and Silver Lake Partners is on increasingly shaky ground. Dell Inc. (NASDAQ:DELL)’s board of directors denied his voting change request to not count shareholders who do not vote in the opposition column, but did grant him and Silver Lake the possibility of another round of voting delays on the proposed buyout if it sticks to its slightly higher bid of $24.6 billion, or $13.75 per share ($0.10 higher than the original bid), which was announced last week. Michael Dell has been adamant in his stance that he won’t raise his offer, so this battle royale is certainly about to get interesting.
Exelon Corporation (NYSE:EXC) reported its second-quarter earnings results yesterday before the bell, and overall, they were solid. Exelon Corporation (NYSE:EXC) did miss EPS by $0.01, reporting a profit of $0.53, but handily topped revenue projections of $5.76 billion with $6.14 billion in revenue. Furthermore, Exelon Corporation (NYSE:EXC) reaffirmed its full-year EPS forecast of $2.35-$2.65, which is right in line with the Street’s current expectation of $2.48 in EPS. Perhaps some of the backlash can be traced to Exelon Corporation (NYSE:EXC)’s management sticking with its large nuclear portfolio despite its high cost in recent quarters. As for me, I see Exelon Corporation (NYSE:EXC) reducing costs as needed to make ends meet, and I foresee the U.S. government stepping in with subsidies in the not-so-distant future to make nuclear a viable option for fueling America, once again.
To end on good news, office-supply superstore Staples, Inc. (NASDAQ:SPLS) was upgraded on Wednesday by research firm Zacks to strong buy. The reasoning behind the upgrade is Staples, Inc. (NASDAQ:SPLS)’ focus on improving its direct-to-consumer operations, its expanded product offerings, and streamlined cost structure. I’ve been saying, since the Office Depot–OfficeMax merger was announced, that Staples, Inc. (NASDAQ:SPLS) is in perfect line to garner market share from its rivals because of store closures and the appearance from consumers of being the strongest of all office-supply chains.
We can do better
Although it was a relatively short week, it was nonetheless a down week for the portfolio, with both my best and worst performers since inception taking a hit. The real trouble has been the persistently uptrending market, which works in the opposite fashion of a deeply discounted contrarian portfolio. We’ve only had one correction since January, and this portfolio rapidly picked up steam during that quick swoon, so I look forward to a moderating market going forward, and the expected rise of this contrarian portfolio.
Check back next week for the latest update on this portfolio and its 10 components.
The article One Person’s Trash Is Another Person’s Treasure Portfolio originally appeared on Fool.com and is written by Sean Williams.
Fool contributor Sean Williams owns shares of QLogic, Dell, Skullcandy, and Orange, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool owns shares of Dendreon, Skullcandy, and Staples, and recommends Exelon and Orange.
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