My mate Phil (@sloan_phil on the Tweets) has kindly provided this Guest Blog following the recent events regarding cuts to Dividends and his action in reviewing and rejigging his Income Portfolio. I have read it a couple of times for proofing and all that and it is really good and has some excellent insights into investing in US Stocks.
Many thanks to Phil for providing WD Readers with this and a personal thank you for saving me a load of work in writing a blog this week !!
There was a discussion recently on Twitter about PCF Group and my mate Paul Hawkins mentioned that he had some notes on PCF and kindly he agreed to whizz them over to me so that Readers could share his findings and thoughts. A big THANK YOU to Paul for sharing this stuff and saving me a lot of time creating a Blog at a time when I am quite busy. It’s much appreciated.
Paul is a very knowledgeable and successful Investor and you can follow him on Twitter where he puts out a lot of useful stuff. His handle is @Hawkeye_74
THIS IS NOT A TIP OR RECOMMENDATION. I AM NOT A TIPSTER. PLEASE DO YOUR OWN RESEARCH. PLEASE READ THE DISCLAIMER ON THE HOME PAGE OF MY WEBSITE. IF YOU COPY MY TRADES, YOU WILL PROBABLY LOSE MONEY. I HAVE A LARGE PORTFOLIO AND I USE DIVERSIFICATION TO SPREAD RISK ALONG WITH TRICKS LIKE HEDGING AND OCCASIONALLY BY THE USE OF STOPLOSSES - IF YOU BUY ANY STOCK YOU REALLY SHOULD FOCUS ON HOW IT FITS IN WITH THE REST OF YOUR PORTFOLIO AND KEEP RISK MANAGEMENT AT THE FOREFRONT OF EVERYTHING YOU DO. BE AWARE THAT ALL INVESTORS/TRADERS GET THINGS WRONG AND MANY STOCK SELECTIONS WILL WORK OUT BADLY.
You have probably noticed that this is Part 2 of the Blogs – if you have not read Part 1 yet you can find it here:
THIS IS NOT A TIP OR RECOMMENDATION. I AM NOT A TIPSTER. PLEASE DO YOUR OWN RESEARCH. PLEASE READ THE DISCLAIMER ON THE HOME PAGE OF MY WEBSITE. IF YOU COPY MY TRADES, YOU WILL PROBABLY LOSE MONEY. I HAVE A LARGE PORTFOLIO AND I USE DIVERSIFICATION TO SPREAD RISK ALONG WITH TRICKS LIKE HEDGING AND OCCASIONALLY BY THE USE OF STOPLOSSES - IF YOU BUY ANY STOCK YOU REALLY SHOULD FOCUS ON HOW IT FITS IN WITH THE REST OF YOUR PORTFOLIO AND KEEP RISK MANAGEMENT AT THE FOREFRONT OF EVERYTHING YOU DO. BE AWARE THAT ALL INVESTORS/TRADERS GET THINGS WRONG AND MANY STOCK SELECTIONS WILL WORK OUT BADLY
This is Part 1 of what might be 2 Blogs or it might be 3 !! Hopefully this will give Readers a good insight into what HOTC does and some important information like details about Directors, Strategy and the Risks that I have identified. In the next Part I intend to cover the Valuation aspects and suchlike which should complete the picture. Please note this is only touching on the information that is available and I suggest that Readers have a good look around the Company Website and also the latest Report & Accounts is worth reading.
At the time of publishing Part 1 I do not have a Position in HOTC and there are no guarantees I will buy any Shares but it is certainly something that I think has excellent Long-term potential.
There are plenty of images within this document so please click on them if you wish to see more details and in theory they should get bigger.
If you have not had the dubious pleasure of the first 2 bits of this Blog Series, then you should be able to locate them at the following Links:
This final Part of the Blogs is a bit different as it postulates (is that a word?) a technique for analysing a Stock and then has an example to show it in action.
When reading any News item and in particular when looking through Results on Recovery Situations, a great way to understand the true relevance of the information is to separate bits that are Historic from bits that will impact in the Future. To a large extent I do this in my head in the Mornings when working through the RNS Statements and this is easier to do on Stocks which I know extremely well because I have held them a while and the changes in the Business leap out at me. The logic being that bits that are in the past are irrelevant really (ok, they do give some context but 9 times out of 10 they are unlikely to be repeated), and it is things that are likely to impact in the Future that really should be concerning us and getting our attention. I think this is a huge mistake a lot of People make - it is so easy to focus on past problems and totally overlook a significant change that is happening within the Business. I know this because I make this cognitive error all the time myself.
If you have not had the dubious pleasure of reading the first part of this Blog Series, then you should be able to locate it at the following Link:
Debt and Cash are arguably the most important Numbers you can find in the Headlines - and you would be amazed how often the Debt Number is conveniently not included. I have even had Results Statements in recent Days where I have found no mention of the Debt level in the first few bits of the Results Update and I have had to scroll and scroll and scroll right down to the actual ‘Financial Review’ bit to find any mention of Debt - and of course you can be 100% certain that if I have had to do this then the Debt Mountain is chunky and the Debt has probably increased (if the Debt had improved, you can guarantee they would be bragging about it up front !!).
Private Investor Websites
A continuing mantra you will hear and read from me is around the value that talking to other experienced Private Investors and Traders can provide. In addition, I find this is widely under-appreciated and it is probably the biggest source of Learning that I undertake these days. Indeed, undertaking the TPI Podcasts venture and being able to discuss countless aspects of Investing with someone as talented and successful as @Conkers3 is a huge help to my thinking with regards to how I go about things.
This can be on different levels - probably the main focus for me is to hear the techniques and methods other Investors use and these discussions bring ideas for potential ways in which I can tweak how I go about things in order to improve my Results. On another level, and probably of less interest to me, are the views of other Investors with regards to which Stocks they are invested in and what their take on certain Stocks is. Of course this can be hugely dangerous because it is immensely ‘Noisy’ Information and I won’t just listen to any old Tom, Dick or Fred and there are only a limited group of Investors who I do take notice of on particular Stocks and I perk my Ears up when they give an opinion. Screening out less useful opinions is of course difficult and it is only over time with experience that you can find out who is worth listening to and who just adds to your Noise levels - yet again a situation where there are few alternatives (if any) to actually going through the motions and doing your ‘time’ in the Markets.
THIS IS NOT A TIP OR RECOMMENDATION. I AM NOT A TIPSTER. PLEASE DO YOUR OWN RESEARCH. PLEASE READ THE DISCLAIMER ON THE HOME PAGE OF MY WEBSITE. IF YOU COPY MY TRADES, YOU WILL PROBABLY LOSE MONEY. I HAVE A LARGE PORTFOLIO AND I USE DIVERSIFICATION TO SPREAD RISK ALONG WITH TRICKS LIKE HEDGING AND OCCASIONALLY BY THE USE OF STOPLOSSES - IF YOU BUY ANY STOCK YOU REALLY SHOULD FOCUS ON HOW IT FITS IN YOUR PORTFOLIO AND KEEP RISK MANAGEMENT AT THE FOREFRONT OF EVERYTHING YOU DO. BE AWARE THAT ALL INVESTORS/TRADERS GET THINGS WRONG AND MANY STOCK SELECTIONS WILL WORK OUT BADLY.
I was going to Tweet out my thoughts about this but decided it might be better to just to do a small Blog on it and that way I could be more flowing in my scribbles and of course I can just Tweet out a Link anyway.
On Tuesday 27th November 2018 I was at the excellent Mello Investor Show in Chiswick for the Afternoon and into the Evening and although I spent pretty much all my time socialising with various Twitter Mates and some Investors who I had not met before, I did have an intention to speak with FireAngel to try and understand what was really going on and if there was any hope here.
I probably didn’t hear it - I have had some sort of problem with my Left Ear for a while and I have been shoving that Earex Olive Oil stuff in it for about a Week and now I am at the stage where I am still partially deaf but I am not sure if the Ear is the problem or if it is because it is full of Oil !! I think it is time to stop pouring Mazola into my lughole.
Stoplosses are such a funny subject area - there is nothing like it to provoke a heated and busy discussion on Twitter and I merely mentioned that I was thinking of writing a Blog related to this and it kicked off a torrent of Tweets on Friday !! Anyway, I have produced a decent Draft of the Blog and I will mention that more in a bit.
We’ve had rather a change in the Weather this Weekend and it has been a bit frustrating for me because I am in the final stages of sorting out the Paintwork on my BMW Z3 but with really strong winds yesterday and rain today there was just no way I could get the final bit of preparation done and the spraying on of the Lacquer Topcoat which then just needs leaving for 2 Weeks before I can finish the job off.
At least I have been able to finish the Front Bumper though and if you see my Tweets you might have spotted my handywork. I am very pleased because I felt that my work on the Bumper had gone OK but the most recent stage was to spray the Lacquer on and I wasn’t too happy with it because it seemed ‘dusty’ or ‘rough’ (bit like Sandpaper really) and I think this might be because the Weather was too hot when I sprayed it on. Anyway, the problem was that I couldn’t know if this was a problem or not until 2 Weeks had gone by which gives the Lacquer time to ‘cure’ and then I could attack it with T-Cut which is described as a ‘Rubbling Compound’ and I like to see it as a sort of extremely fine Wet n’ Dry Paper that comes in a liquid form a bit like a Polish. It is really gentle especially in the ‘Metallic Paint’ form I need to use and it takes ages but with loads and loads of elbow grease I finally managed to get a shine into the Paintwork and it looks really good. It is amazing how good the T-Cut is because when you run your fingers over it now it is super smooth, unlike the ‘Dusty’ feel it had before. I suspect the finish was not a problem it just meant that I needed to do more Polishing work with the T-Cut to make it decent - as always if I was to wait for the perfect Weather conditions then I would never get the job done.
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