By
Rich Smith
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More Articles
August 29, 2011
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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Leaping lizards, Batman! Shares of private equity player Fortress Investment Group (NYSE: FIG ) leapt 10% in Monday trading. Even if you think their business is just a little bit slimy, the sight of folks making a quick 10% profit probably got your attention.
So what: So what caused the pop? There's no obvious catalyst today, but on Friday, a blogger on Seeking Alpha may have primed the pump. Pointing out that private equity players KKR (NYSE: KKR ) , Blackstone (NYSE: BX ) , and -- you guessed it -- Fortress have lost roughly one-third of their market cap apiece over the past month, the author mused that there's now a chance for "fifty percent upside in each of them just to get trading where they were one month ago."
Now what: And yes, I suspect that's what sparked the feeding frenzy today. That, and the general "We survived the hurricane!" bullish feelings on Wall Street. Before you join in the buying, though, it's worth noting: Of the three stocks highlighted in Friday's Seeking Alpha article, two are currently profitable. The third is ... Fortress.
Can a profitless P/E firm make for a profitable investment? Add Fortress to your Watchlist and find out.
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