Yellowstone Partners Blog

In our quarterly newsletter we issued in September, we talked about using Google Trends to derive investment ideas. One of the positive trends we have been tracking and specifically mentioned was Amazon.com’s reading device, the Kindle.

Here is the Google Trends chart of search inquiries on the Kindle.

You may have noticed the massive move upward in Amazon.com’s share price on the heels of their most recent earnings release. The news, a 68% increase in net income, came from broad strength in sales across all of their various merchandise offerings, and while they were tight-lipped about exactly how much the Kindle is contributing, they were comfortable saying that it is their best-selling product.

Further developments in the Kindle include a significant price drop, international wireless connection, and use in many US universities. This is a story we will continue to follow.

Disclaimer: AMZN is owned by clients of the firm, but is not owned by the writer of this article or the principal of the firm. Stocks may gain or lose value, and past performance is not a guarantee of future return. This is not to be interpreted as an offer to buy or sell any security.

Greetings from the Raymond James Investment Manager Conference in St. Petersburg, Florida. We recently listened to a very compelling presentation by Jeff Saut, Chief Investment Strategist at Raymond James Financial.

He brought out some very interesting investment ideas, some of which we were already following, and some of which provide interesting new possibilities.

First among the interesting new ideas was the effect of the recent El Nino weather pattern on the ecosystem of the Humboldt Current and the consequent decrease in a significant source of protein for both human and animal consumption.

Apparently, there is a constant upwelling of cooler water from the Antarctic coast, along the western border of South America, which creates a unique environment where fish can thrive in water with colder temperatures and higher salinity – this is known as the Humboldt Current. Since fish are abundant in this ecosystem, so also, are fishermen, and it’s estimated that as much as 25% of the global fish production is drawn from this area of the world.

The kicker, then, comes in how the El Nino weather pattern is anticipated to affect the Humboldt current. As it happens, the easterly flowing countercurrents push southward into the Humboldt current, forcing much of the abundant fish deeper underwater and thus out-of-reach for the fishing operations.

The consequence of this process will potenially be a severe drawdown in the available protein sources for a growing worldwide population. Following the law of supply and demand, there is opportunity for a derivative play on other protein sources, to include livestock, fisheries, and even soybean producers.

These kinds of investment “tailwinds” provide a tangible story and figures to monitor for confirmation on an investment idea. Stay tuned for more details on what Jeff Saut had to say at the conference.