I am having a break with tradition tonight because normally I would do loads of Charts and stuff on a Sunday Night but for various reasons I am running tight on time but also I wanted to update the ‘Weekly Performance’ bit on my Homepage (my plan is to finish this on Monday Night) and I thought it would be useful both for myself and for Readers to go through the Stocks in my Trading ISA and extol my current thinking on each one of them. I am not going to cover the ones in my Income Portfolio because I think they are mostly getting a mention in the Final Parts of my Income Portfolio Blog Series anyway (the last of which should go out later this week).
On top of that, last Week with Thanksgiving and all that was pretty dull with low Trading Volumes etc. so I’m not sure we could learn much from the Charts anyway. At a very high level, Markets just seem to be continually buoyant even if my Portfolio doesn’t want to follow their lead !!
So let’s crack on with the Stocks…….
AA Ltd. AA.
This one has been hugely problematic recently after the Profit Warning and the Exit of the Chairman after a punch up !! A new Chairman and a new CEO are in place and I usually find that such changes are the start of improving the performance of a Business. The last Update said they were in line with the much lowered expectations and there is a lot of focus being put on improving the way the Business operates and of course AA’s big challenge is its Debt mountain and clearly more effort is needed to get this down. It is interesting that despite all the troubles they have held the Interim Dividend but I wouldn’t be at all surprised if they end up cutting it out - perhaps they should if it means that getting the Debt under control is more do-able.
At the moment the Shares are still in a Long Term Downtrend Channel although for the last 3 months they have really gone Sideways. There is clearly a long period in Rehab needed here but due to the Brand Strength and highly loyal Customer Base and I am happy to stick in here and see how things play out. It is too early to be Averaging Down or anything as there could be a lot more issues ahead but at some point I expect things to start properly improving in the Business and also that should be reflected in the Chart set-up which should give some decent Signals around when it is safe to get Buying again. Keeping things simple, usually the clearest Signal I see that things are on the mend is when we get a 50/200 Day Moving Average ‘Golden Cross’ - and we are nowhere near that yet.
Accsys Technologies AXS
This is my High Risk speculative punt and I have a small Position in it - but I am happy with how things are going and I am content to stick with it. They had Results this week and the demand for their in effect Plasticised Wood is very strong and they are unable to make enough. The key to this problem is expansion of their Accoya making plant at Arnhem and this should come on stream early in the next Financial Year - this will give 50% more capacity. In addition, they are building a Tricoya plant in Hull and this will be completed further out but provide a lot of new capacity for their Plasticised Board product - all good stuff. I am happy with my Position at the moment and can’t see any great rush to buy more - but at some point I would like to increase my Holding but only if they make the kind of progress on both the extra Capacity and on the Revenues/Profits that will set them up for a bright future.
Air Partner AIR
This one has been going very nicely and I am well happy to hold - in fact, it looks highly attractive. They have done a serious of small Bolt-on Acquisitions in recent Years and this is helping to move their growth up a bit but seems to be done in a managed and risk-aware way - pretty impressive really. The Chart drives me insane because even after the Share Split it is still very choppy and volatile but I find the best way on this one is to look at the Heiken Ashi Candlesticks and just cut out the Noise. In terms of Valuation on a Forward P/E of 15.8 (arguably lower if you strip out the Cash but it needs to be appreciated that much of the Cash is JetCard Prepayments) and a Forward Dividend Yield of 4.3% it is decent enough Value. Talking of the Chart, it is in a nice Long Term Uptrend and not far off the Highest Point over the last 7 years.
This one is infuriating. They came out with Results this Week and the Shares got hit hard - this was particularly frustrating because the Share Price had been rising nicely of late (I think it had been rising with the Oil Price). They are having trouble in Argentina and I guess this is where the disappointment came from -although I note the Chart did a Long Tails Doji Candle on Wednesday 22nd November and perhaps they can recover off of this. On a Forward P/E of 13.6 it is not expensive and comes with a Forward Divvy of 3.4%. I have held for ages and it has been painful but it seemed to be recovering and I was hoping we would get some good Results so I could buy more and Average Down - so far I am not confident enough to do this. It is worth noting that AGK did a 50/200 Day MA Golden Cross a few weeks ago - this is often a very positive sign.
AVAP has been dropping a lot lately but it looks very unjustified. I would like to buy more of these but I just don’t have the spare Cash at the moment to do so. Simon Thompson of Investors Chronicle reckons the NAV is over 275p per Share and with the Current Share Price at 216p there is clearly a discrepancy. AVAP is due to pay 2.6% Dividend Yield next year and the Divvy here is getting pretty attractive now - and I expect it to rise in future years. Recent news from AVAP has been good especially them getting lots more ATR Options. AVAP is due to have an AGM on the 20th December.
This one has been doing my nut because it just looks too cheap. It is particularly irksome because Prudential PRU has been pushing up near All Time Highs (ok, PRU is more Asia focused but I think AV. Is unfairly being ignored) while AV. has been dropping. On a Forward P/E of 10.3 and a Forward Divvy Yield of 5% the numbers look appealing and the Chart might have done a ‘Double Bottom’ around the 490p ish Level. A big negative on the Chart is a recent 50/200 Day Moving Average ‘Death Cross’ but if the Share Price can do some Sideways action for a while (or even better to rise !!) then that Death Cross could get reversed in coming Weeks. With Markets generally buoyant I would have expected AV. to have done pretty well. It is bizarre but I am going to continue holding - partly because I am extremely impressed by the CEO Mark Wilson who has done a superb job of sorting out a Company that was going through tough times a few years back.
The Chart on this one has got quite unpleasant lately and it keeps making New Relative Lows which is not good - and on top of that we are right on the verge of a Bearish 50/200 Day Moving Average ‘Death Cross’. However, as I mentioned on AV. above, these Death Crosses can get reversed in time and if BOO can stabilise then it need not be too much of a problem. Obviously the issue here is around the Valuation which is very stretched but I am happy to keep holding as when I look out 5 years time, I expect BOO will be perhaps many times larger than it is today. In the Short Term it is under pressure but in the Longer Term I think BOO will be a huge success. In business terms BOO is doing everything right and the way it engages with kids using Social Media and suchlike is outstanding - in fact, I heard from a mate recently that BOO had gained 500k Followers on Instagram in just one month - that is incredible growth and remember this is just one Social Media Platform. For completeness, BOO is on a Forward P/E of 51 now which is nowhere near as high as it was and with so many Stocks on bonkers multiples I am pretty relaxed about this - BOO is a very fast growing Business and it won’t take long to grow into that Valuation. It is worth appreciating the expansion of their Warehousing Facilities as well - this shows a lot of confidence.
Cambria Automobiles CAMB
Car Retail is clearly a troubled Industry at the moment but CAMB’s latest Results were pretty good considering the challenges. On a Forward P/E of 8.3 it is not particularly steep and if we can see some confidence return to the UK Economy then this could look cheap. Chart wise it has been chopping around for a long time now but note it is not far off a Bullish 50/200 Day MA ‘Golden Cross’ - if that happens it would be very nice to see. I am happy to hold but I don’t have a big position.
I inherited these Shares as a result of the Quantum Pharma QP. takeover. I only have a small Position but I have been quite impressed by what I have read about CLIN since it arrived on the Stockmarket a few Years ago. I wouldn’t say CLIN was ‘Cheap’ on a Forward P/E of 15.7 and an ungenerous Forward Divvy of 0.69% but it is not extortionate. At the moment I don’t have the Cash Firepower to buy more but once I am more flush I will be considering buying more CLIN. There is a lovely Long Term Uptrend here and the Shares recently pulled back to the 200 Day Moving Average Line which could be a good area to be buying - they have an AGM this Tuesday 28th November but of course we never know if this means a Trading Update will be coming out as well.
Conygar Investment Company CIC
Another frustrating Share - this is just so cheap but I guess the current negativity towards Commercial Property (particularly in London although that does not affect CIC) and the small size of CIC means it is not getting much attention. It just looks silly cheap though on a Discount to NAV perhaps as much as 35% (Simon Thompson suggests CIC property is worth 250p a Share and that allows nothing for the Development Assets). I note it did a big Hammer Candle on Friday 24th November after a sustained drop which might signal a Reversal is in the offing. I am happy to continue holding with a small Position but if it was to rise a fair bit then I might seriously consider selling it and moving on - I find it a frustrating Stock to hold.
This one got hit by a Broker Downgrade recently but I think that is just more ‘Noise’ and I take little notice. The simple fact is that since DVO’s struggles many Months back it has recovered very well and is still in an Uptrend. It pulled back to the 200 Day Moving Average Line on the day of that Downgrade and this seems to be acting as Support. On a Forward P/E of 13.5 and a Forward Dividend Yield of 4% it looks appealing and with other Meat Groups like Cranswick CWK and Hilton HFG on very high Ratings it looks good value still. Sausage Skins are pretty boring and demand quite predicable and stable so I expect DVO’s inherent Business Strengths of longevity and geographic diversity to help it keep moving forwards. I also would not be surprised if they got taken over.
Diversified Gas & Oil DGOC
I am really pleased with this one and recently bought more. It is a fairly recent IPO and I think it is still overlooked and misunderstood by the Market. Obviously a rising Oil Price is very beneficial for DGOC but even without that the Business Model of buying loads of ‘Nodding Donkeys’ and improving their efficiency should drive the Share Price higher anyway.
DGOC put out a good Trading Update and ShareScope now puts it on a Forward Divvy of 5.3% - I have seen forecasts of higher than this but whichever is right, this Stock looks a steal. This is quite a new Stock and I don't think the Market really understands it - this is often the case with new IPOs and they can take a long time for people to really get the value - with lots of low cost 'Nodding Donkey' Wells in the US Shale region this looks a very reliable business and I am impressed with how the Management are doing exactly what they said they would. I wrote a Blog on them when I bought in which you can find under 'Stock Buy Rationale' on the Blog Page.
Several things stuck out in the recent Update - firstly their Cost of Production is down to around $7 per Barrel of Oil Equivalent which is extremely low, secondly the Titan acquisition is going really well, they are lowering maintenance Costs by using Staff more efficiently, restarting shut Wells and right-sizing Compressors which push the Gas/Oil to the surface. It is worth reading the comparison with DGOC if they included the Titan numbers (the Acquisition took place the day after the Accounting Period ended) but it must be appreciated that the Synergies DGOC are getting are not in those numbers so that is upside. Note also that DGOC have the capability to do more Acquisitions and reading between the lines they are already looking at a few - these could boost Earnings.
Entertainment One ETO
I’m really pleased with this one - after needing a huge amount of patience as it just wobbled up and down for years (despite the Value screaming out) we were finally treated to a Breakout (as I pointed out in several recent Chart Blogs) and it is now up near its All Time High which is about 324p - if it can get above this then that would be super-bullish. This week ETO put out some Results which were really well taken and despite problems in their Film Division (which is now being merged with the TV Production bit) the Market was very happy. The Children’s Cartoons bit is doing really well with Peppa Pig becoming increasingly popular and with another 186 Episodes actually being made (think about it, that is a huge amount of new Episodes) and then the success of the New Property, PJ Masks, is astonishing with Revenues up 600% !! The Library Value is now up to $1.7bn and rising and this in itself is only roughly around the current Market Capitalisation - so there is nothing in the Price for the future of the Business which is clearly pretty promising.
On the downside, ETO’s Accounts are a total mess - but no one seems concerned about it !! I think the Company is being viewed like one of those US Tech Businesses where the Future Potential means that niceties like Profits and Cashflow are largely ignored. There is a lot of Takeover activity in the Media Sector particularly in the US and it is clear ETO could be a Target.
Esure Group ESUR
ESUR looks cheap on a Forward P/E of 12.3 and Forward Divvy of 4.75%. The Management here appear very switched on and know their Industry really well as their turnaround of GOCO demonstrates. Recent Results were good but the Shares keep drifting - perhaps they are getting treated like many other Big Dividend Stocks. The Share Price is very near a 50/200 Day Moving Average ‘Death Cross’ so this could drop a bit more yet before perking up. I am happy to hold as it looks good value but it might be annoying for a while.
EMR did a Profit Warning recently which was down to a Legal Change in Germany and some issues in the Middle East (which are being addressed). Despite this, EMR actually will produce the highest ever Results in their History. Therefore, on a Forward P/E of 7.9 and Forward Divvy Yield of 1.3% the Sell-off here looks a total over-reaction and I am very happy to hold. It is quite a Volatile Stock and I suspect this was part of the exaggerated Fall after the Profit Warning - and it is worth nothing that on Friday 24th November they did a nice White Up Candle - this could signal a rebound is on the way. With the Global Economy doing well and EMR having lots of Country Offices, I think they are well placed to keep producing decent Results - even if the Analysts are hopeless at forecasting !!
French Connection FCCN
God knows why I bought this pile of doggie doo. I luckily don’t hold much and I am desperate to dump it but while it has been trending upwards I have been riding that move. However in the last Week or so it has fallen right off so I am seriously losing patience. Awful Company run by a Founder who is unable to let go and hand it over to someone who might be able to run it properly.
Galliford Try GFRD
This Housebuilder and partly Construction Stock has dropped off a lot since it went Ex-Dividend and now looks extremely good value (as do most Housebuilders). On a Forward P/E of 6.1 and a Forward Divvy of 8.7% the numbers speak for themselves. It is worth noting that Housebuilders as a Sector tend to do really well in Q1 of each Calendar Year and this might be the kind of Catalyst that is needed to perk them up. In the meantime I am happy to wait it out and pick up the huge Dividends.
Commodity Stocks in general have done really well lately and GLEN is in a nice Uptrend Channel. On a Forward P/E of 10.9 and a Forward Divvy of 5.7% the numbers have appeal. For now I am happy to ride the Upwards Momentum but I am very wary of Mining Stocks as the underlying Commodity Prices could easily fall out of favour.
GoCompare.com Group GOCO
Oh no, that dire Opera Singer !! Anyway, I will let him off as he seems to be keen to make Money for me - and that is very desirable. GOCO recently got a Takeover Bid from ZPG for 110p a Share and this was rejected as too low (I couldn’t agree more !!). ZPG have now said they won’t bid again but the chances are we will see them again in 6 months time and if they don’t bid, then someone else might be interested. On a Forward P/E of 13.2 and Forward Divvy Yield of 2.4% it looks decent Value (but not especially ‘cheap’) and at 99p they are well below the Offer of 110p that was turned away. The upside should be obvious.
Golden Prospect Precious Metals GPM
Another infuriating Stock. In fact, it is Gold as well that drives me to insanity. I have been very patient here but I am of the view that Gold is just a waste of space and I regret getting involved in GPM. There are a gazillion problematic issues in the Global Economy and Political Scene so maybe at some point Gold will finally perk up and drag GPM up with it - if so, I hope I will have the presence of mind to dump this.
IOM has the most frustrating and unreadable of Charts (it is choppy beyond belief !!) but for a Quality Datacentre Stock it looks superb value still despite a really strong run up in recent weeks after good results. On a Forward P/E of 18 and 2.1% Forward Divvy it is very low for the Sector (I am sure TCY Telecity was taken-over on a P/E of 30) and a Takeover is very possible. It might seem totally bonkers but if you put IOM on a Forward P/E of 30 you get a Target over 600p - therefore a Target of 500p would be very doable. IOM is a big position for me. IOM has Interim Results on Tuesday 5th December and the Chart looks like it is turning up again off of the 50 Day Moving Average Line.
McCarthy & Stone MCS
MCS has been awful for a long time but looks like it is finally escaping the Downtrend Line which goes back to April 2016. On a Forward P/E of 7.8 and Forward Divvy of 4.6% it looks good value although other Housebuilder Stocks are perhaps more attractive (I think BVS and CRST in particular for their high yields although I don't hold those and of course GFRD which I wrote about earlier). MCS has historically commanded a higher P/E ratio because of its Retirement Homes niche so I suspect it will find Support soon and start to move up again - it certainly looks like the Chart could be bottoming out. Again MCS could benefit from the usual Q1 Housebuilders resurgence.
MLIN had a decent set of Results but in the current Market sogginess it didn't do much. To me this is daft cheap - if you strip out the Cash Pile then it is on a Forward P/E of about 4 - I think the upside here is at least 100%. It is worth realising that as MLIN deploy that Cash Pile (of about £22m I think) they should be able to add on some nice Earnings Boosting Acquisitions which should mean Analyst Upgrades which should drive the Share Price up. I have a big position. The Forward Dividend Yield is 1.4% which is nothing special but of course there is a chance that they give some of that Cash Pile back to Shareholders. The Share Price has been going sideways for some time now but it looks like they might be turning up again. This is very much a business in Transformation with the new CEO changing it from a Tobacco Machinery business to something more in the Consumer Packaging area - it looks a very sound Strategy.
Moss Bros Group MOSB
This is a very well managed Business with the CEO, Brian Brick, being particularly switched on. There are a lot of changes going on with Shops being refurbished and many closed and more emphasis being put into Online Sales which seems to be working although these are still a small proportion. People think of MOSB as a Suit and Dress Hire business but in fact this is a tiny part of what they do, with Sales of Suits and stuff being the main business. They have a huge Cash Pile and this supports a big Dividend Yield of about 7.5% next year and the Shares have just done a big Hammer Candle on Thursday 23rd November and this might have flushed out a lot of Weak Holders. Obviously MOSB is probably getting caught up in the weakness of the Consumer and fears over Retail Sales, but their Results have been good.
On The Beach Group OTB
The Shares have been floppy here for a while but they have Results on Thursday 30th November and the Shares look like they are turning up after dropping back to the 200 Day Moving Average Line. On a Forward P/E of 18.8 and just about 0.8% Forward Dividend, this looks fair Value for an Internet sort of Stock and if the Results are good then I think there could be upside. I am very happy to hold this for the Long Term.
Patisserie Holdings CAKE
This has been soft lately and even did a 50/200 Day MA ‘Death Cross’ recently - not so welcome. However, on a Forward P/E of 17 and nearly 1.3% Dividend Yield next year, it looks attractive. CAKE is due to have Results tomorrow (Monday 27th November) so we should know more following these !! However, I like what Luke Johnson has done elsewhere and I am happy to be holding these for the Long Term (unless of course something goes dramatically wrong).
This is my only direct Foreign Stock at the moment and I have held it for a while after it span-out of Ebay. PYPL keeps going up and making new All Time Highs and with Tech being so buoyant over in the US I am happy to keep running it. I get exposure via a Spreadbet so this means I have no Forex Risk as I bet ‘Pounds per Point’ even though it is priced in Dollars.
Pets at Home PETS
This one perked up a lot recently but then fell back when KKR sold a chunk of Shares. They have Results on Tuesday 28th November so we should know more very soon. I still like these as a long term play and on a Forward P/E of 13 and a Forward Divvy of 4.3% it isn’t too expensive.
Somero Enterprises SOM
SOM has been very lacklustre for a long time now, but on a Forward P/E of 12.2 and Forward Divvy of 3.4% it looks decent Value for a business with such dominance of its market. On the negative side SOM might find US business slows a bit from the Hurricanes and they are having to rethink their China strategy. At present the Share Price is just going Sideways but I am very happy to hold these. A strong US Economy could help here.
Sprue Aegis SPRP
The Share Price has been very weak here lately and they just did a 50/200 Day MA ‘Death Cross’ which is not so great. However, SPRP had a decent set of Results recently and on a Forward P/E around 15.6 (or less if you strip the Cash out) and a Forward Divvy of 5.3% this looks good value for a dominant player in its Smoke Alarms business. The change of Suppliers should be very beneficial and I am happy to hold SPRP and wait for the Market to appreciate it a bit more and pick up a sizeable Divvy while I wait !!
Standard Chartered STAN
STAN has had a weak Share Price lately and even did a 50/200 Day MA Death Cross a few Weeks ago. It is a bit annoying but recent Trading Updates have shown progress after the problems from recent Years and buoyant Commodities and Emerging Markets should help STAN. On a Forward P/E of 14.8 and a Forward Divvy of 3% it is not too expensive and I am happy to hold onto it.
St Ives SIV
SIV has had decent Results and is clearly in Recovery mode. On a Forward P/E of 5.6 and Forward Divvy of 2.6% this looks really cheap and they are addressing the high level of Debt and the Pension Deficit. On the Chart we were treated to a 50/200 Day Moving Average Golden Cross some weeks ago which suggests plenty of upside to come. As I expected, it looks like Broker Forecasts for 2019 have been raised but the chances are they are still too low - so the crazy cheap P/E might be even lower in reality. SIV is due an AGM on Thursday 30th November - fingers crossed although of course we might not get a Trading Update.
Stanley Gibbons SGI
I got totally caught on this one and am going to lose pretty much everything I put in I suspect. It is particularly annoying because I was in a nice Profit at one stage but I failed to pick up on how badly run this actually was - the crazy spending on the Website should have alerted me earlier but a lot of this came out after the Trouble had already spanked the Share Price. Anyway, the price of not using Stoplosses is that sometimes this kind of disaster will happen and it does not bother me too much - I will lose about 1.5% of my Portfolio at the most so the damage is fairly contained. I need to sell the Position that remains at some point when I get around to it.
I have been really patient with these and it has paid off hugely. The Shares recently Broke-out to a New All Time High and this suggests we will see more gains. SGP has lots of Cash and on a Forward P/E of 17.5 and 1.9% Forward Divvy it is still good value despite the run up. I expect a lot more Gains here and I think a Target of 2500p is not insane.
I was quite amused by this one this Week. The Market utterly spanked the Shares on a ‘Profit Warning’ but I see that as rather silly because the issue with TCM is nothing to do with Earnings or anything (the Accounts have been such a mess for ages that no one can sensibly take a view on the Earnings or the Future Earnings until things are a lot more stable) but it is everything to do with the fact that I am now certain this is not a Fraud - despite the claims of many people who should be more circumspect when making such outrageous statements. TCM gained a new Chairman this Week and he used to work for the US SEC (Securities and Exchange Commission) so I think we can assume he is quite switched on. He has reviewed the Business and is happy with what he sees although of course they put out the irrelevant ‘Profit Warning’. My concern with TCM has been around the reality of the Revenues as I have been almost entirely unable to find any evidence of actual Sales but with the appointment of the Chairman I am happy that there are no problems on this front. I am happy to hold TCM and there are no other ways to play IoT on the UK market that I can see.
TRI had good Results recently and hit a New All Time High - this has been a big Winner for me and I am so pleased I let it run (Run your Winners !!). I think there is more upside and I am happy to hold. On a Forward P/E of 18 and a Forward Dividend Yield of 1.5% it is not cheap but similar Stocks are on higher Ratings in this crazy Market so I think there could be more gains. It is not one to hold in a Big Position I feel and I will be looking at the size of my Position possibly with a view to trimming a bit off.
This has been another big Winner and is looking quite expensive on a Forward P/E of 30.5 and a Forward Divvy of 1.6%. It is no steal but the Value is perhaps justified by the imminent expansion into the US where the upside in terms of Revenue and Profits could be significant. I am happy to hold.
This really is an ongoing saga - the Results have been delayed again and we have no date for them to come out - but I suspect they might even slip into January. It is infuriating but I am happy to hold and see how it plays out.
Water Intelligence WATR
WATR recently put out a good Update - this is one I bought a few months ago so I am pretty happy. A Forward P/E of 16.7 looks ok for a Small Growth Stock and I am expecting plenty of upside here - there is a 'Buy Rationale' Blog from a few months back. Water plays are very unusual and WATR are very established especially in the US - indeed, the damage in terms of leaks caused by the Hurricanes could be very positive for WATR.
That’s the lot, I hope everyone has a good week,
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