I was pounding the table for a long time with BKN. Today I trimmed my position but still hold 1/2 of my full allocation. I am still relatively bullish longer term.
I wouldn't draw the assumption that b/c PE made a bid that it "must be bottom of cycle". Remember the previous PE bids on the way down?
No doubt this management group seems more competent than their predecessors, and conditions appear to have stabilized a little for now, but keep in mind this...
1/ China is running on fumes with unprecedented stimulus. The media don't even try to accurately cover China's horrendous debt and infrastracture oversupply.
2/ There is still a massive supply glut that will take years to work through
3/ EM economies are still very much hurting. The main reason for the rally in EM shares is part relief, but mostly the US dollar decline.
4/ BKN still have significant debt (which people tend to forget about during upturns)
5/ There are some major macro/currency issues still present which are not even close to being addressed by central planners.
Again, still bullish but my expectations are tempered in the short-medium term. Momentum is strong right now but I expect there to be opportunities to add more on a pullback.
