Nathan’s Famous
I have owed Nathan’s shares for some time and see the current selloff as a good opportunity to pick up more in this well run business with plenty of cash to little to no debt, which makes them well positioned to whether or even grow during the current economy.
Heavenly’s picks, a summary
Hello to our blog readers 🙂
Jeremy was looking over my portfolio recently and thought I should comment on my holdings.
Last year, I decided to try my hand at investing by starting out with the ‘fake stock market’ as I call it, started an account with Marketocracy, but soon found their system to be very laggy with processing orders, so I decided to just follow up with my portfolio on Yahoo finance.
My methods of choosing stocks are mainly:
- Do I personally use their product?
- Do I love their product?
- Do they offer a dividend?
- Take a look at the company’s charts over the past few years to get a rough estimate of when the low points are, to obtain a pattern of when to buy in.
My first purchases were back in October of last year, (as some may speculate, usually a good time to buy in when stocks usually take a hit), started with 10 shares each of Walmart at 44.89, Hasbro at 28.65, and 20 shares of Silver: SLV at 133.87.
At the beginning of November, I grabbed 10 shares of our favorite hot dog, Nathans at 16.55.
At the beginning of February, I grabbed 15 shares each of Burger King at 26.01, and Kohls at 44.68.
Last month, I grabbed 10 shares of Petsmart at 19.17, 20 shares of Pepsi at 21.01, and 20 more shares of Nathans at 15.17.
This month so far, I’ve grabbed 20 shares of Ebay at 31.69 upon news of JetBlue using Paypal in their payment options, and also grabbed 20 shares of Yum brands this morning at 38.38.
As of this posting, I’m up over 13% overall… not too shabby for dabbling. 🙂
Full Disclosure: I do not own the following stocks mentioned above at the time of this article
Nathan’s Famous a Good Buy
The recent market sell off has created a lot of good opportunities. One I like right now is Nathan’s Famous (NATH).
Even though I already have a significant portion of my portfolio in Nathan’s, I feel that the current levels are too cheap to ignore for a company this strong.
Here are some reasons why I just bought more shares today:
- Strong brand with diversified revenue. Nathan’s has one of the top brands of hotdogs in the business that are distributed through restaurants, food service and grocery stores. People still need to eat and I don’t feel the economy will get bad enough where people cannot afford a hot dog and Nathan’s has one of the top hot dogs.
- Great balance sheet. No significant long-term debt and penty of cash ($33.2M). In a market with tightening credit, they should have no problem continuing to expand with their own money. They also have low operating costs.
- Great valuation. If you take away the cash, the company is valued at $57.54M. If you take last year’s income ($5.54M), the company is making a 13% return per year on it’s assets. The company has continued to grow revenue and income year after year.
Below is a great article from June 2007 that goes through past numbers in greater detail…
Nathan’s Famous: This Dog Can Hunt
Full Disclosure: I own shares of Nathan’s Famous.
