Savor this moment, Dow Chemical. Treasure it. Never let it go.

Hedge-fund manager Dan Loeb has a message this May Day: Ignore the old market adage “sell in May and go away.” In a letter to investors in his $14.3 billion fund, Third Point LLC, Mr. Loeb admits to being a bit too optimistic to start the year and says that hindsight shows “certain sectors were clearly exhibiting bubblelicious valuations.” But he believes the pullback in stocks created the chance to add to positions at “attractive levels.” That means it’s time for the traders to come out…

A big section of the letter is spent on his investment in Dow Chemical, which Mr. Loeb had suggested be broken up earlier this year. This time around, Mr. Loeb makes no references to a break up and is much more complimentary of the company. “Management’s level of shareholder engagement has also risen notably, demonstrating an admirable and strong commitment to addressing long‐standing concerns,” he writes. Still, not everything is resolved, and Mr. Loeb continues to have concerns about Dow’s petrochemicals unit performance. He says the company is “under-earning” by at least $2.5 billion.

Dan Loeb’s Advice for 2014 Investing: Pick Carefully and Be Patient [MoneyBeat]

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Comments (3)

  1. Posted by guest | May 1, 2014 at 4:40 PM

    is he feeling alright?
    -concerned guest

  2. Posted by Guest | May 1, 2014 at 5:18 PM

    He also made the same "bubblicious valuation" comment when asked about Jennifer Lopez in 1997.

  3. Posted by Mexi_Cant | May 1, 2014 at 6:02 PM

    Sounds like solid dating advice.