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December Idea of the Month: Cleanup Time!

By Travis Johnson, Stock Gumshoe, December 16, 2011


This month I have one particular stock in mind for your consideration that I think is in a great secular growth industry, with fair valuation, a decent and growing dividend, and an appealing future.

But first, a few other little things:

One, don’t forget to take your taxable losses — I’m no fan of trading in and out of stocks like a jitterbug, but if you’ve made any trading profits this year then a loss sitting idly by in your taxable accounts at this time of year does you no good. Make it a realized loss, use it to offset some of your trading profits, and you can buy it (or a better idea) again next year with a clean slate. I’m planning to do this with a few of the stinkers in my portfolio over the next week, though most of my family’s investments are in tax-advantaged accounts so it doesn’t usually have a big impact on my portfolio. Don’t forget about wash sale rules (you can’t harvest a loss and then buy the same or “substantially identical” stock or fund back immediately or vice versa, there’s a 30 day “waiting period”).

And two, if you’re looking for something riskier and interesting, I’ve been pondering a bonus idea: have a look at Benton Resources (BTC on the Venture exchange in Canada, BNRJF on the pinks). This is a tiny stock up in Canada that operates as a prospect generator — sort of like Altius Resources, which I write about with some regularity, but much smaller and more speculative. It’s way too small for me to target as an “Idea of the Month,” and frankly it’s probably too speculative given their reliance on one stalled miner, but there’s an appealing “sum of the parts” argument to be made for the shares that you don’t get to see all that often.

Briefly, Benton holds about ten potential projects in Canada — mostly extremely early stage exploration projects (ie, they’ve staked out the claim or done initial survey work, but no drilling). A couple of those prospects are partnered with other companies to advance exploration, but there hasn’t been any exciting news recently from these projects that makes anyone break out in a cold sweat.

They also, and this is the more interesting part for my valuation, hold equity positions in a handful of companies, and they’re ...

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