A High-Quality Problem

 | Apr 02, 2014 | 3:23 PM EDT
  • Comment
  • Print Print
  • Print
Stock quotes in this article:




Ever been annoyed when one of your stocks goes higher? Sometimes I am, simply because I ask: "What took you so long, stock? You had all of that good news and nothing happened to you. Now you have nothing new and you rally like you've gotten a bid?"

The Action Alerts PLUS charitable trust has two of them today: Timken (TKR) and Vale (VALE).

Timken's a break-up story; a company splitting into a value-added steel company and a basic one, and both are best-of-breed. It has done very little since it decided to split and then suddenly today it roars up a buck-and-a-half. Would it be too much if the stock had rallied when it reported the last good quarter? This random activity rankles me because it is so hard to game.

But if Timken isn't gameable, consider Vale. Here's a company that has done everything it can to bring out value: give a dividend, close underperforming businesses and produce the finest iron ore in the world. Almost every time something good happened, the stock got hammered.

Today, it's up gigantically. Today! The only news? A coal train of Vale's has been attacked in Mozambique. You can't make this stuff up.

I know these are high-quality problems. I know that I should be thrilled that these two dogs are at last hunting. It shows you that it pays to be patient. It's just that, in the end, you wish that stocks reacted to news and not just random buying and selling.

Today, random buying is more aggressive than random selling in Vale and Timken, and the charitable trust is the unwitting winner.

Columnist Conversations

We will take off some more risk, bank some winners SOLD PG OCT 90 CALL AT 3.3 (in at 2.90) ...
After a very calm and sedate period of volatility which saw the VIX fall not only to all time lows but had a r...
today is a good day to lighten the load and take some positions off the table. SOLD WB OCT 85 CALL AT 11 (i...
I reached out last week to my close friend Ken Shreve, who is a prominent writer for the IBD.  I asked Ke...



News Breaks

Powered by


Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.