Lil Scrappy raps "Money In the Bank" but if you read my June 1st Stocks and Locks post (click here -> http://urbanomics.blogspot.com/2007/06/june-week-1-stock-and-lock-picks.html ), you'd think my recommendation Collectors Universe (CLCT) was the one 'collecting'...all the way to the bank. CLCT, which authenticates precious metals, was literally a hidden gem when we found it. It has risen from $13 to settle to just about $14. There were indicators that told me that CLCT still had a way to go and we tipped our hand to the loyal readers here at Urbanomics to buy CLCT. Not only did they already represent a great turnaround play, but I am a firm believer that management was persuaded by activist investors to increase the already healthy dividend in this stock to a level that I have never seen before. The dividend payout was doubled almost overnight. I believe activists knew this, and as I've written before this produced the catalyst that we needed. Smart investors flocked to this stock for the chance to get paid twice:
1. As the stock appreciates
2. As fat dividend checks are paid out
Once, they made this announcement to the public, investors went nuts over this huge dividend payout and for the last two days the stock has appreciated roughly over 7% last Friday and 9.9% today. We collected over 15% in two days!
Here is a quick summary of CLCT's release from the Associated Press:
Collectors Universe Inc., which provides authentication and grading services to dealers of collectibles, diamonds and gemstones, said Friday its board raised the company's quarterly cash dividend to 25 cents per share from 12 cents, previously.
Keep gettin' your Urb on...cause this ain't a game
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