Weekly Review
Some nice gains over the past few days after a rough start to the week.

Income Portfolio: Opened new positions in $AMLP and $TSN . Increased holdings in $ARCC $OZK $AFG $DKS $HRL and $LCII . Collected dividends on $INTC $KR $CMI $RDN $RS $JNJ $PCAR and $TSCO .

Growth Portfolio: Increased holdings in $ENPH and took partial profits on $PINS leaving a small holding remaining

Speculative: Nil
September Watchlist Update
I have reviewed my watchlist and updated my potential Birthday Buys for the month of September. As we move closer to January, I am getting more clarity into what I will be buying.
Looking at both portfolios right now, the most intriguing additions are in my Roth IRA. The top rated holdings in my Taxable watchlist are all industrials type companies ($DE, $F, $CAT, and $DMLP). Seeing that I already have Industrials exposure in that account through $CARR, making another Industrials addition would only further clutter and dilute my portfolio.
In my Roth IRA, I have a number of very strong potential buys with $OZK, $RICK, $CAH and $LMT topping the list. As I have said before, I do not like to be influenced by share price, but with Merrill Edge not offering fractional shares, $LMT might be priced out for me in the short term.
Here is my updated watchlist for both accounts and changes that were made:

$PENN - Has dropped to a 4/6 on my Scorecard. $RICK has moved ahead of it at a 4.5/6. I have existing exposure in Sin Stocks, so I want to be certain with any new additions.
Added: None
Roth IRA
$REGN - Dropped to a 4.5/6 on my Scorecard. $CAH is a higher ranked Healthcare company at a 5.5/6 on the Scorecard and will be my Healthcare focus.
$WM - Its back! After being removed in August, $WM has climbed up to tie $AY as Utilities options at 5/6 rankings.
$TPR - Surprised to see this climb up to a 5/6. Have been tracking for a while after learning about its brands. Will continue to track.
Would like to hear any of your thoughts on the companies mentioned to help add to my research on these positions.
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Week in Review
Well actually the past fortnight in review. Missed my weekly post last week as I was off spending time with family and reliving my childhood a little (see photo) :).

Income Portfolio: Opened new positions in $INVH and $ARCC . Increased holdings in $XOM $OZK $NXST $AFG and $LCII . Collected dividends on $NXST $ABR $FAX $DSL and $EMD .

Growth Portfolio: No new buys but unfortunately stopped out on $SSO down 15%. Stopped out on $ETH.X also for a 10% gain.

Speculative: Sold all $CRSP and $CCJ for small gains

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Wow them dudes are still alive😳. I was born in 81, mom had KISS albums all over the place. Not sure how she liked Prince & Kiss, but that’s pretty much all I heard growing up.
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$OZK - Quick Bites
As I have noted in my last two watchlist posts that $OZK is at the top of my list to add to my Roth IRA.

I am working to do more "quick bites" of research to help round out my understanding leading up to my Birthday Buys in January.

I want to use a standard approach as I do research on my watchlist positions. I will cover the following:

  • Core Business/Operating Locations
  • Growth Engines
  • Financials Performance
  • Key Takeaways

This past weekend I took some time to look through $OZK's most recent investor presentation to see how this bank currently makes money, and plans to make money in the future.

Core Business
$OZK's core business is loan interest. In their investor presentation, $OZK calls out that they are currently achieving a net interest margin of mid 4%, versus an industry average of 2.5%.

$OZK operates branches in 8 US states, primarily in the Southeast. However, they have loans currently in over 50 US markets.

Growth Engine
The primary growth engine for $OZK moving forward is growing their Real Estate Specialties Group (RESG).

The top 3 segments in their RESG portfolio currently are Multifamily, Mixed Use and Office.

The top 3 markets in their RESG portfolio (by value) are NYC, Miami and LA. All of these are large, and growing, markets that should continue to provide opportunity in the real estate space.

The RESG portfolio currently consists of 305 loans, with the majority in the $100 - $199MM range. These are some pretty substantial loans!

I would not be considering this company for my Roth IRA if it did not have a strong dividend history, so I will start there. $OZK has raised its dividend each of the last 48 quarters & every year since its IPO in 1997.

A second way $OZK is returning value to shareholders is through stock buybacks. $OZK is set to complete its $650MM share buyback plan in November, 2022.

The financial metric that $OZK published and shared in their presentation was Book Value per Share. $OZK's BVPS and Tangible BVPS have both steadily increased over the last 10 years.

Key Takeaways
Overall, I think $OZK would be a solid add to my portfolio. This "Quick Bite" of research I did helped support the high ranking this company is currently getting in my Scorecard. My 3 Key Takeaways from this activity are:

  • Have a defined and measured growth strategy through RESG
  • Are not dependent on personal loans and personal mortgages for interest income
  • Returning value to shareholders through Dividends and Buybacks

Thanks for following along! This is the deepest I have dove into a prospective new addition in a long time and is an area I am working to improve in. I would love to hear your feedback on my summary or input on the business!
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What I did this week
What I did this past week was enjoy a long overdue holiday with the family. A week in the mountains, great weather, snow falling. Watched the little 'uns learn to ski, and renewed my own enjoyment of the sport once again. The muscles and bones are feeling every day of my 54 years now though :)

Income Portfolio: Opened a new position in $HRL . Increased holdings in $DVY and $OZK . Collected dividends on $KMI $OKE $TXN $AOS and $HTGC .

Growth Portfolio: Opened new positions in $CELH and $SSO . Cut losses on $HALO and $BMBL. I still like both of these and will revisit another time.

Speculative: Sold all $MANA.X for a small gain.
August Watchlist Update
Below is an update on my watchlist for August in preparation of my Birthday Buys in January! I am targeting to add 1 to 2 positions in each portfolio. Some of the great July Ideas recommendations have made their way onto my watchlist 👀
$COST - I have a number of other very strong alternatives that I would add ahead of Costco, so I removed it from my watchlist.
$DE - Jumped to a 5/6 to tie $DMLP as an Industrials option.
$F - Potentially breaking one of my rules by choosing not to invest in auto manufacturers. This was a July Ideas rec, and ranks as a 5/6 to tie $DMLP as an Industrials option.
$CAT - Jumped to a 5/6 to tie $DMLP as an Industrials option.
Roth IRA
$WM - Dropped from a 5/6 to a 4.5/6 over the course of July. Added $AY, which has a higher ranking at 5/6.
$ALL - Dropped from a 5/6 to 4.5/6 over the course of July. Still have $OZK as strongest potential Financials picks ranking at 5.5/6.
$AFL - $OZK increased from a 5/6 to a 5.5/6, which is now my strongest potential financials play. $AFL has therefore been removed.
$RICK - July Ideas rec. Ranking at a 5/6 and strong Sin Stock option.
$AY - July Ideas rec. Ranking 5/6 as a Utilities option.
$CAH - Jumped up to a 5/6 in July to tie $AMGN as a top Healthcare option.
$REGN - umped up to a 5/6 in July to tie $AMGN as a top Healthcare option.

​My predicted picks in July were $PENN in my Taxable account and $AMGN in my Roth IRA. Now in August, my picks have changed to $CAT in my Taxable and $OZK in my Roth IRA.
I'd love to hear your thoughts on my picks and thought process!
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Yegor's avatar
$181.8m follower assets
Nice to see a "not so deep dive" is planned :)

Always enjoy reading your letters, feels like its a good way to catch up with you.
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James Andrews's avatar
$16.2m follower assets
What I did this week
A reasonably quiet week trading wise but a solid week for the portfolios with some nice gains across the board. Monthly wrap up to follow later this weekend. I have a 10 year reunion for a team sports championship we won in 2012 so unlikely to be in any condition to crunch the numbers today or tomorrow :)

Income Portfolio: Opened new positions in $DVN and $LCII . Collected dividends on $ROP $OZK $AFG and $CMCSA . Trimmed $PCAR with a view to being all out over the next few weeks. Sold all $JEF for a negligible gain.

Growth Portfolio: Added $SWAV to my portfolio holdings. Up 25% on my $ETH.X purchase last week. I will be keeping a close eye on this and have set a tight trailing SL.

Speculative: Nil activity once again but $MARA had a nice bounce as did $NOTV
Yegor's avatar
$181.8m follower assets
Bank $OZK GAAP EPS of $1.10 beats by $0.08, revenue of $292.11M beats by $4.93M
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