Earlier this morning, my Copart (CPRT) stock hit an appreciation target of a 30% gain triggering a partial sale of 1/7th of my position or 30 shares which were sold at $43.80/share. This represented a gain of $10.08/share or 29.9% since purchase. The shares were initially acquired 9/27/07 at a cost basis of $33.72/share.
As you may know, I use sales like today's sale as a 'signal' to buy an additional position if I am under my maximum of 20 positions. Since, after yesterday's sale of ResMed (RMD), I am at my minimum of 5 positions, well under my maximum, this sale indeed did give me a 'permission slip' to be buying a new position.
A few moments ago I purchased 70 shares of Visa (V) as that new position. I shall be writing this up a little later.
Even though I have sold shares of Copart (CPRT), with the company's solid second quarter results (even though they did miss expectations) and their strong Morningstar.com '5-Yr Restated' financials,
COPART (CPRT) IS RATED A BUY
When would I sell shares next and how many? Well on the upside, my next sale point would be at a 60% appreciation target which with the cost basis being at $33.42, this would work out to 1.6 x $33.42 = $53.47. At that time, my plan would be to sell 1/7th of the remaining shares which now at 180 shares would be 180/7 = 25 shares.
On the downside, after a single sale (at the 30% appreciation level) I move my sale point up from an (8)% loss to break-even, or in this case would mean selling all of my remaining 180 shares if the stock should decline to $33.42.
