Into the black

The turnaround in my portfolio performace in the last two months has been outstanding. It has moved from being down over 15% to showing a small profit in what felt like a few weeks. This was largely thanks to a strong recovery by eBay and an incredible rise by Google.

My Google shares have risen in value by over 40% in the four months I have owned them. The question now is whether to lock in the profit or hold on?

I still think the share price has further to go this year, although it may drift until the Q2 earnings come out. My reasoning is that the market still does not fully comprehend how much the earnings can grow over the next few years. Obviously the Q1 results were fantastic and the shares have been re-rated accordingly. But even after the rise Google's PEG is inline with the market based on a 30% growth rate for the next 5 years. But I think 30% is too low for the next couple of years. 40 or 50% is probably closer to the mark. So I think Google has still got a couple of positive re-ratings left in it before it is fully valued.

The eBay share price is extremely volatile at the moment and after clawing its way back to $39 it has now sunk down to £36.5. However I am holding for the long term and expect I will be showing a profit on my $43 entry price by the end of the year.

The market is cheap. This is a great time to be fully invested in stocks.