5/9/14 Weekly Picks

5/9/14

Long TRMB ($35)

• TRMB uses remote sensing technologies for various industries, mainly construction and agriculture.
• In their agriculture segment, their products increase yield by using GPS and rain sensors to tell farmers exactly where they need to water, fertilize, harvest etc. most efficiently.
• This industry is booming and will only get bigger with growing populations and limited farmland - farms have to start using technology to become more efficient and profitable.
• Company is growing quickly and very profitably.
• They missed earnings last week so it finally gives a chance to get in after a pullback.
• Farm tech is getting to be huge and they are the leader.
• Long term play

Short WWE ($17.25)

• WWE is exactly what you think, World Wresting Entertainment. Yes, they are still around and yes, people still waste money watching this.
• Stock has gone from $10 to $30 in the past year due to their online subscriptions where fans can watch current and past media on the internet.
• Instead of growing their revenue substantially, it will likely just switch fans from TV to internet and cannibalize their current base, not increase it.
• Revenue growth is flat over the past few years and they are barely profitable (600 P/E ratio).
• We missed the boat a bit here, it has already fallen from $30, but has room to fall further.
• Vince McMahon is the company, it would crash without him. Let's then consider he is 68 and has obviously been on steroids for an extended period of time. I would bet against his liver.

Short LOCK ($13)

• LOCK is lifelock, the commercials where the guy guarantees you won't have your identity stolen with their products, although the founder has had his personally stolen 13 times.
• The company has frequently been under investigation for fraud, but has weathered the storm. They are now under investigation again, and the results haven't been released yet.
• Their products don't add value, they scare consumers into buying and now other competitors (like CapitalOne) are offering similar products for free.
• We missed the boat on this one as well (down 20% YTD) but could fall further after the FTC is done with them.