Being Contrarian


Contrarian investing is psychologically difficult. Investors often must look at a stock chart that shows a 60% decline, or even higher, and ignore any pattern-recognition skills that tell them that the price is going to decrease further. Much of the discussion of the stock may come from short-sellers, who have earned high returns from the stock’s decline and have seen their investment thesis justified.

Each stock below has at least a $2 billion market cap, a short interest of at least 5%, and a stock performance on a trailing 52-week basis that is in the 20th percentile of the market or lower.

As you guys know, I like the coal stocks on this basis and I am not rendering an opinion on any of the stocks below, but I do like WLT, and will wait for earnings to get out of the way on that one.

I may do a post on the coal names over the weekend.

Green Mountain Coffee Roasters

Market Cap: $2.7B; Short %: 19%; 52-week return: -81%


Market Cap: $4.5B; Short %: 22%; 52-week return: -71%

Research In Motion

Market Cap: $3.6B; Short %: 18%; 52-week return: -74%

United States Steel

Market Cap: $2.6B; Short %: 24%;

Ultra Petroleum

Market Cap: $3.4B; Short %: 13%; 52-week return: -53%

Market Cap: $2.1B; Short %: 8%; 52-week return: -67%

Patterson-UTI Energy

Market Cap: $2.3B; Short %: 10%; 52-week return: -55%

Ivanhoe Mines

Market Cap: $5.9B; Short %: 7%: 52-week return: -71%

Walter Energy

Market Cap: $2.1 B; Short %: 6%; 52-week return: -75%

Abercrombie & Fitch

Market Cap: $2.9B; Short %: 8%; 52-week return: -54%

Cliffs Natural Resources

Market Cap: $6.1B; Short %; 7%; 52-week return: -57%

Riverbed Technology

Market Cap: $2.3B; Short 5: 6%; 52-week return: -53%

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