Monday, July 25, 2016

Raising Cash, Selling Dead Weight

Over the last two weeks I sold a couple of things. First, as I mentioned in my articles, I sold my small position in Johnson & Johnson (NYSE: JNJ). It's getting well above its average valuation and I wanted to lock in those gains.

I also sold half of my position in Aflac (NYSE: AFL) in a different account which I manage. I'd been long Aflac for several years, and as the company nears its ten-year average valuation, I've lightened up some and raised cash. I am still long Aflac and, in fact, I think it might have some more gains ahead of it.

I've also been selling some "Dead weight" in legacy energy positions. I got rid of a tiny position in Kinder Morgan Inc (NYSE: KMI) which was lingering in an IRA which I manage for myself. Glad to be rid of that. Also, I sold a legacy position in Mid-Con Energy Partners (NYSE: MCEP). Frankly, I don't believe things are looking too well for that name if crude oil is going to remain in the 40s long-term, which looks increasingly likely. I may put some of the remaining capital into Williams Partners (NYSE: WPZ), or I may just hold onto the cash.

In this environment I am valuing cash more and more, and raising it where I can. There are some good values out there, such as AbbVie, British Telecom, Williams Partners and IBM, but I personally do not have much dry powder, so I am inclined to hold onto the cash I have at this point.

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