July 25, 2014

Buy, Sell, Hold: 2012 SEC Football Edition

It’s been a while since we took stock of the things around the SEC to see where everybody stands.  With the Hogs on bye last week, we had a little time on our hands to check in on our competitors around the league.

A couple of teams are off to successful starts in 2012 with their new coaches.  But a few more than expected find themselves with coaches (CEOs) now squarely on the hottest of seats.

In tribute to one of our favorite money guys Jim Cramer, here’s the RBN version of the “Lightning Round“…SEC style.

Alabama — The Tide are the perfect example of what a blue chip stock should be.  Strong CEO, remarkable earnings, and the best long-term BUY in college football.  Despite its largest of market capitalizations, we like it for the dividends.  The only thing that could derail it short term is rumors of the CEO flying to the NFL.  Own it.

Florida — We have been impressed with how quickly new CEO Muschamp has turned the Gators into a smash-mouth team.  While their 7-0 start has caused the stock to run up quickly, we’re still a BUY at this price, and see Florida owning the SEC East for a few years to come.

South Carolina — The Gamecocks have just finished a brutal stretch (Georgia, @LSU, @Florida) and at 1-2, feel like they missed their earnings projections by a bit.  Their defensive front is maybe the best in all of college football, but you saw what they looked like without RB Marcus Lattimore.  Previews of future years don’t look so hot.  If you own it, it might be a good time to take some profits and let some of it go…SELL on a still reasonable high.

LSU — We are still not sure what we have in the 2012 Tigers.  Are they the team that played Auburn to 12-10 steel cage death match?  Or are they the confident team that methodically dismantled a quality South Carolina team at home?  The Tigers and CEO Miles have a week to prepare before hosting Alabama on November 3.  A win there could change the season’s outlook, so let’s HOLD the stock for now, but be wary.

Georgia — Why do people keep buying this stock?  Because their grandfather owned it and passed it down from generation to generation?  The shareholders are getting tired of CEO Richt under performing vs. earnings estimates.  The Bulldogs never ‘beat the street‘.  At this price, we are a SELL…we’re done with them.  Good luck if you’re riding it out.

Mississippi State — The Bulldogs are on sitting on their 52-week high right now after starting the season at 7-0.  It is their best string of earnings since 1999.  But with a tough three-game stretch looming (@Alabama, Texas A&M, @LSU), now’s a perfect time to SELL it and put your proceeds elsewhere.  Not a fan long-term, especially with their neighbor to the north improving.

Texas A&M — We are big on companies that have good products to sell, and right now, we can’t take our eyes off the flavor of the day – new sensational QB Johnny Manziel.  Plus the balance sheet is strong – the Aggies have more cash (and alumni) than they know what to do with.  This is a prime spot to buy in for the run up.  BUY it, even on the MARGIN if you can.

Arkansas — The big investment firms dumped the Hogs when that motorcycle hit the ditch.  The rest of the public investors (fans) got out quickly after Louisiana-Monroe burst the bubble.  The interim CEO didn’t help matters with his PR blunders.  If you still own it, you should probably HOLD it, because its too late to sell it now.  If the new CEO looks like a promising hire, start to ACCUMULATE in small blocks it at these prices.

Tennessee — The Vols are a sleeping giant of a company that is about to be in the market for a new CEO looks like.  Angry investors spray painted “Fire Fooley” among other things on a rock on the UT campus.  We’re certain he can’t survive this, and they’ll be starting over again.  Is it time for ‘Chainsaw Al‘ to make an appearance and clean house…including the AD?  SELL for now…and buy interest in a travelling circus – you’ll get the same results.

Ole Miss — What an incredible dumpster fire this company was when the former CEO (a.k.a. ‘The Quarterback Killa’) was shown the door.  We like what Hugh Freeze has done in a short time stablizing the company and giving them a chance to win each week.  We think its still a good time to BUY the Rebels if you feel you must.  There are other, better places to put your money, but we see some room for a small run up at these prices.  There is a long-term ceiling though.

Vanderbilt — CEO James Franklin has done a good job at a company where its not easy to recruit and win.  While we may not like his antics sometimes, the results are that the Commodores have a shot at being bowl eligible two years in a row.  That’s historic for this company.  That said, there are better places to put your money, so we’ll pass.  If you own it already, might as well HOLD on to it just for fun.

Missouri — Of all people, we know what its like to join the SEC unprepared.  Missouri finds itself in that boat right now.  We’re not sure the investors realized it until Vanderbilt came into Columbia and won 19-15 a few weeks ago.  The Tigers CEO Pinkel has had some success, but is he up for the challenge?  If you own it, SELL it for now…you can jump back in in a few years and buy it again for the same or lower price.

Kentucky — Granted injuries have decimated the Wildcats this year, especially at a key position like quarterback.  We don’t think the Board of Directors is going to give CEO Joker Phillips another year to turn this company around.  Steer clear of this perennial bottom feeder.  And if you own it, SELL it and buy lottery tickets with the proceeds.  At least then you’ll have a shot at making something.

Auburn — If you still own this dog of a stock, you should call and fire your broker.  We haven’t seen a stock fall like this since people woke up and realized that Krispy Kreme Doughnuts (KKD) was bad for your health.  Despite the worst start since 1952, we think the front-running CEO Chizik can run this even further into the ground with Alabama looming at the end of the season.  SELL IT SHORT it if you can find any takers.

Happy trading.

  • JimDoggg

    Very amusing. Personally I think you should hold MSU until after the Bama game. The Dogs have been impressive and how they do against Bama will tell us something about the Hogs’ chances later down the road. Blowout by Bama would be good news but dogfight or win, not such good news. At this point, SEC Coach of the year seems to be Muschamp, followed by Mullens, and then Freeze. Big, big, big game will be Fla and Ga. Richt might surprise but his scheduale advantage may have disappeared. Don’t place your bets yet. Two weeks ago the media had aready annointed Geno Smith the Heisman for sure, no arguement. Not a chance now because WVU is going to lose some more games. And there were those in the MSM sports world who thought the WVU would win the Big 12 (10) or whatever. Doesn’t say much for the big east now does it?

  • Hawgfan100

    Brilliant article (much like Doc’s over on 360)!

  • GolfHog

    Richt reminds a bit of Broyles. Broyles couldn’t win a game until he turned the team over to Wilson Matthews to build a squad. His hay-day was built on bright aggressive assistants. Richt is a great face for the program, probably a pretty good closer on the recruiting trail. But, he needs to turn Ga over to better assistants; one of which can kick butt and take names.