In the past I have created a Post each time that I have traded. This makes for a lot of posts to click through so I have now decided to do one Post per quarter & add to it. Latest transactions first.
General commentary
28th November – Direct Line (DLG.L) has confirmed that it received a takeover Bid from Aviva (AV.L). I hold both and DLG has been a woeful investment for me. My ‘Gift Horse‘ policy states that I should sell… however….back in February DLG was on the receiving end of an all-share Bid from Aegas SA, which it also rejected. Conceivably they could come back for another bite and their share price is now considerably higher. Decisions, decisions.
Update: Sold this morning after mulling it over. First lossmaking sale for a while. See details, below
w/c 28 October – Big issues with non-declared commission payments for car loans that mean the Banks might also be on the hook. Some are talking of PPI level damages. To me it does see that they were following the Law, then a Court decided they weren’t – even though they were. The knock-on effects could ripple through anywhere where sales teams are paid a commission on loans, so I think they will be fighting hard to overturn this latest issue, in which case affected Businesses should bounce back. In the meantime I’ve taken a hit on Lloyds and Secure Trust Bank who both seem to be well on the hook for this. Not rushing to sell currently.
24th December
OK, wasn’t planning on doing anything for the rest of the year, but hand forced somewhat. Vistry (VTY) issued a shocker of a Trading Update. Profit this year £250M rather than £300 because of delays. A few other excuses thrown in there, too. Shares down approx. 17%. Wow. 3rd warning in a row. Those that say warnings come in threes usually come out at this point to justify the aphorism, and this has been the case today. Personally I don’t pay too much attention to it. That leaves the question as to what to do. Sell, hold or buy more?
- The sell case. Management reputation is now officially trashed. It will be a long climb back from here
- The hold case. Bad news out there, well below asset value now. In addition, the revenue is delayed, not lost 9so they claim…)
- The buy more case. Hit my top-up target of a 10% drop, however it hit it due to bad news, not a general decline. Not so clear cut.
I still think that eventually it will come good, or get snapped up as there is plenty of asset backing. No Sale, then. As it’s a profit Warning rather than decline, topping up is out for now. So, ‘hold’ it is.
What I have decided to do, however, is to Bed and ISA it. I’m sitting on a lot of taxable profit on my Trading Account, so by selling it that will reduce my 2024/5 tax bill as well as shelter future recovery, should it happen.
To be able to do this I’ve had to sell something in my ISA. EZJ has to go. I’ve been dithering about this, this week anyway. I’m really quite overweight and am sitting on a nice gain. I’m still positive, but selling reduces my exposure a bit. Still plenty left in my SIPP.
It has also freed up some cash in my Trading Account by virtue of selling and I have bought into International Personal Finance (IPF). This was a spin-off from the Provident, which had a rough time. IPF seems to be suffering from this association, despite showing a good track history. Bought in.
Allocation blocks
I have a certain size block that I buy in / top up at. 1 Call it 1 unit. I top up 1 unit, even if I have more than 1 Unit sitting there in cash. This ‘unit’ has been the same for a while as the Portfolio has grown. It means that if I have more than 1 unit sitting there, but less than 2 I can only make 1 purchase until some Dividends or a sale comes in, leaving cash sitting idle. Rather than having it sitting there, I’ve now relaxed my criteria. As long as it’s not a bit of a punt I am allowing myself 1-2 unit’s flexibility to initially invest.
VTY Vistry – Sell and ISA
Sell price: @538p (buy back at 548p – price fluctuations in those 10 mins or so)
Buy price: 750p (average)
Dividend income: 0% (non-weighted average)
Gain (loss) -18% total (-18% + 0%) -160% pa (not compounded) equivalent!
EZJ – easyJet – Sell
Sell price: @354p
Buy price: 575p
Dividend income: 1% (non-weighted average)
Gain: 63% total (61% + 1%) 102% pa (not compounded) equivalent
IPF – International personal Finance – Buy
See commentary, above. Bought slightly above my minimum allocation. Again, see above.
Buy @ 128.5p with a Dividend yield of 9.5% (covered about twice) and PER of 5.6.
Portfolio %: 2.1%
Total Portfolio Holdings: 2.1%
23rd December
Carrying on the tidying up & also I’m turning really positive on Safestore. I want to keep adding to this as cash becomes available. Made some available today with the sale of Vesuvius (VSVS)
VSVS Vesuvius – Sell
Bought this in November. Had a decent yield and PER. A week later there was a downbeat trading update, citing ongoing depressed Markets and price pressures. Mr Market made one of his frequent irrational conclusions and since then the price has climbed by 10%. Whilst I’m positive that it will recover as the World Economy climbs out of the current dip, I think it will be more extended. Who knows what tariffs will be put on US imports when Trump gains Power. VSVS doesn’t manufacture steel as such, but obviously any tariffs will indirectly affect sales of peripheral equipment. Sold up for quick 10% Gain, but with an Alert set to buy back in if it gets down to the previous buying price, or lower.
Sell price: @413.5p
Buy price: 364p
Dividend income: 0% (non-weighted average)
Gain: 13% total (13% + 0%) 102% pa (not compounded) equivalent
Safestore top-up
Buy @ 6.45p with a Dividend yield of 4% (covered about twice – does seem to fluctuate) and PER of 15.4. Neither generous, but become so once you subtract fixed assets.
Portfolio %: 1.5%
Total Portfolio Holdings: 2.8%
19th December
Time for a tidy up. Slightly concerned about US warning about fewer rate reductions next year. On this side of the Atlantic, a Labour Government will be inflationary, too so fewer reductions. In addition, if there ever was a honeymoon it is definitely over and I think consumer confidence will take a dip in Q1 2025.
At the Global level we have Trump coming back, more arrogant than ever, which will bring Ukraine to the fore. Who knows what he will have in mind.
On that basis I’ve decided to build up a war chest and sell of some of my strong performers that are consumer facing.
Update – having reviewed my Portfolio, I’ve only made two sales (see below). Everything else will remain. The one I thought were for the chop were BATS, IMB, RWS (part) and EZJ. BATS and IMB are solid dividend payers and whilst BATS is too big, I still hold on to the hope that IMB will get swallowed up by a predator. If you ignore the great run it’s recently had, I’d still buy at this level if I didn’t have any, so it stays. RWS top-up has done well, but it does still seem to be very much undervalued for a Tech Firm specialising in AI. Finally EZJ. Might be heart rather than head but I think that holidays, especially at the easyJet end of the Market will survive any moderate slowdown.
Update 2 – this afternoon, one of my alerts was triggered, so I have bought into Safestore. See below.
So much for the war chest, but it was nice to review everything anyway.
SAFE – Safestore – Buy
Safestore provides secure and dry storage solutions. It makes it nice and fluffy with welcome areas, parking and well staffed to appeal to domestic clients as well as Businesses. It’s a stable and scalable Business. People that rent tend to keep renting and the Business model is easy. Buy some land, put a shell up then subdivide it. Alternatively, buy up a competitor and rebrand. Rinse and repeat.
I had great success with Lok and Store years ago when I realised what a simple model it was. That has now been taken over. For some reason, Safestore has been declining this year from a dual peak of 900p to today’s price of 650p. I can’t fathom out the valuation. It’s Market Cap is £1.4B but even after subtracting long term debt, the units & land are valued at £2B. It’s profitable, and the profits are growing. Perhaps I’m missing something, but if it was to liquidate today there is a 50% upside on the property. The other thing I can’t understand is that the net profit is often higher than Gross. I’ll need to look into that. Perhaps they are revaluing the units every year and adding in the appreciation.
Anyways, until something jumps out at me I’ve dipped my toe in.
Buy @ 6.46p with a Dividend yield of 4% (covered about twice – does seem to fluctuate) and PER of 15.4. Neither generous, but become so once you subtract fixed assets.
Portfolio %: 1.3%
Total Portfolio Holdings: 1.3%
EPWN – Epwin – Sell
This has had a good run this year. It sells windows and benefited from the promise of new house builds. If this falters, or interest rates stay high there is a good possibility of a profit warning, or at least downwards guidance.
Sell price: @ 95.1p
Buy price: 72.3p
Dividend income: 10% (non-weighted average)
Gain: 41% total (31% + 10%) 30% pa (not compounded)
GLE – MJ Gleeson – Sell of top-up
Mild profit warning earlier in year. It was a top-up and the fundamentals are not inspiring. I wouldn’t buy at this price, so have decided to sell the top-up & see where the remaining balance takes me.
Sell price: @ 510p
Buy price: 445p
Dividend income: 8% (non-weighted average)
Gain: 20% total (8% + 15%) 9% pa (not compounded) – calculation (8+15 = 20) seems iffy, will look into over Christmas…
9 December
KGH Knights Group – first top-up
Had some spare cash from the DLG sale and KGH has dropped by about 17% since my first purchase. Professional Services, light on Capital and a recent acquisition plus positive trading update. Only big downside is a £2M hit from NI increases, but not until 2026 by the looks of it, so hopefully absorbed by higher turnover and possible increased prices.
Buy @ 106p with a d/y of 4.7% covered at least twice and PER of 4.3.
Portfolio %: 1.4%
Total Portfolio Holdings: 2.3%
28 November
DLG Direct Line Group – Sell
Aviva made a putative offer for DLG, which was rejected. Whilst they might come back with a higher offer, or Ageas SA might come back with a renewed bid, they might just decide to walk away. On balance you could see a 20% upside or a 30-40% downside if it falls through. I’ve sold as I’m sure I can deploy the funds elsewhere whilst we wait for action. Shame as this is my first sale at a loss since 2020 when I removed some weaker shares hen COVID hit.
Sell price: @ 226p
Buy price: 272p (average over 3 tranches)
Dividend income: 10% (non-weighted average)
Loss: 10% total (-20% + 10%) -3% pa (not compounded)
Lessons: Bought too many tranches close together before my Min 10% drop top-up rule. Didn’t sell out (Gift Horse rule) back in Feb.
27 November
TW. Taylor Wimpy – Buy back in
Sold at £1.66 a short while back. They have dropped back to £1.30 and have decent asset backing. I’m still positive on Housebuilders so an initial tranche rebought.
Buy @ 130p with a d/y of 7.4% and PER of 12.9 Assets of 125p per share, so a small margin of safety there
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
Commentary: LIO starting to take off a bit, although just about to go ex-Div. VTY recovering from its hammering. EZY produced great results today but got quite a muted response. Hopefully will get some Broker upgrades soon. Definitely undervalued (IMO, natch).
20 November
VTY Vistry – First top-up
Looks like I got back in a bit too soon for this share. COO left today and the shares have taken another dive. So much for a margin of safety there.
Buy @ 619p with a d/y of 6.6% and PER of 7.8. Assets of 990p per share, so a margin of safety there
Portfolio %: 1.5%
Total Portfolio Holdings: 2.9%
Commentary: I sold half my PSN holdings a while back, since when they have continued to dive. They are now below the level where I topped up last time, but I’m just hanging on a bit longer this time. Housebuilders seem to be friendless currently.
13 November
CARD – Card Factory – BUY
This was one I held, but sold during the first COVID lockdown. It was so exposed to footfall I wasn’t sure whether or not it would survive. 4 years down the line it has emerged unscathed.
Downsides: Disproportionally affected by NI increases as staff are at the Minimum / Living wage end of the pay spectrum.
Upsides. Great PER and DY and as long as it sustains that I’ll be happy. It’s more than just cards nowadays and several of its competitors have fallen by the wayside (Clintons, Card
Zone). Always seemed to me that my local Card Factory constantly bustled but Clintons / Card Zone always seemed to be empty. Sample size of 1, but scuttlebutt is scuttlebutt.
Buy @ 81p with a Dividend yield of 6.8% (covered 3 times normally) and PER of 5.2
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
PRU – Prudential – first top up
Thiss fall from grace over the years has been quite relentless, but it sits on a decently low PER of 8. DY not so great at 3% but it is well covered and rising.
Buy @ 601p with a Dividend yield of 3% (covered 3 times normally) and PER of 8
Portfolio %: 1.5%
Total Portfolio Holdings: 2.8%
11 November
LIO – Liontrust Holdings – second top up
Not my best call, this but this is so lowly valued, with a stunning dividend yield that it will either turn around, or be taken over. Yield is 16% and is just about covered. Even if they were to slash it by 50%, that is still 8%.
The last update showed cash outflows, but reduced outflows from the previous quarter, blaming the uncertainty about the upcoming Budget from the new Government. Now that is out the way, with no particular hits to Fund Managers, I’m hoping for signs of improvement when they report 21 November.
As it is a second top-up, it will be sold should the SP hit the first top-up value (514p)
Buy @ 436p with a Dividend yield of 16% (covered 0.9 times normally) and PER of 6.7
Portfolio %: 1.4%
Total Portfolio Holdings: 3.7%
8 November
A bit of a reshuffle of holdings as a few price triggers were, err, triggered. Given the current uncertainty here & in the States I thought I’d materialise some Gains, even if they are Taxable.
Commentary: STB still being hammered. PSN that I halved my holding in recently also being hammered, moving towards top-up level. EZJ steadily climbing following good updates from competitors – hopefully should be some results soon.
VTY – Vistry – BUY
I sold these recently as they had risen quite nicely and then decided to start a share buy back programme, rather than paying out Dividends. I disagreed as 1) I like dividends so that I get a choice as to where to reinvest and 2) with a frothy share price I thought that buybacks were a bad decision. As it happens, I dodged a bullet as the Company had to report some shenanigans within its reporting of profits within some divisions. As a result of that, and a gloomy update today, the share price tanked twice, bringing it down by about 50% overall.
I think the Business is sound and that these are temporary set backs, so have been tempted back in again.
Buy @ 700p with a d/y of 6.6% and PER of 9. Assets of 750p per share, so a margin of safety there
Portfolio %: 1.5%
Total Portfolio Holdings: 1.5%
VSVS – Vesuvius – BUY
One I have had an eye on for a while, but never pressed the ‘buy’ button until now. From Stocko “Vesuvius plc is a United Kingdom-based company, which is engaged in molten metal flow engineering and technology. The Company’s segments include Steel and Foundry. The Steel Division operates as four business lines, Steel Flow Control, Advanced Refractories, Foundry, and Steel Sensors & Probes”
Doesn’t produce Steel, so shouldn’t be affected by any Trumpian Tariffs, but benefits from any uptick in production. In the Gold Rush, those that made money consistently were those that sold picks and shovels, not the miners.
Buy @ 365p with a d/y of 6.5% and PER of 7.7.
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
BP. – BP – BUY
Another I have had an eye on for a while. Have traded this in the past and am now back in again. Oil isn’t disappearing ay time soon
Buy @ 373p with a d/y of 6.5% and PER of 7.5.
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
PZC – PZ Cussons – BUY
I sold this back in the summer as it has large operations n Nairobi and the devaluation of the Nairu is causing immense problems. Thanks to listening to a recent talk by Lord Lee, he happened to mention that PZC has now put its Nairobi operations up for sale. Even if it sells it for nothing, then whilst it will be a hit to the BS, at least it won’t be haemorrhaging cash and the remaining rump has some good value – e.g. Carex brand. I’ve tentatively bought back in again in anticipation of a sale over the next 12 months.
Buy @ 79p with a d/y of 4.6% and PER of 11
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
To fund all the above, and also give me some future firepower I ‘ve sold two holdings.
WPP – WPP – SELL
Made a small turn on this. Recent update is not promising and I don’t see the short term outlook improving. Couple that with a non-bargain PE & DY rating I’m happy to get out at a decent profit.
Sell price: @ 845p
Buy price: 743p
Dividend income: 2%
Gain: 16% total (2% + 14%) 42% pa (not compounded)
STJ – St James Place – SELL
This is a fund Manager that got hammered when it was told it couldn’t charge as much as it was used to, and also Assets under Management were decreasing. In addition, it was bought using funds from an inheritance that was managed by a SJP Agent that, frankly, did a pretty poor job, yet still took a high commission. This was a personal mission to claw something back! It worked.
Sell price: @ 826p
Buy price: 496p
Dividend income: 1%
Gain: 67%ish total (1% + 67%) 149% pa (not compounded)
30 October – GSK – Glaxo BUY
GSK plc is a global biopharma company. The Company’s segments include Commercial Operations and Research and Development.
Hopefully needs no introduction. Price has dropped in recent times due to Zantac concerns. I sold these just before they split off Haleon and am now dipping my toe back in.
Buy @ 1402p with a Dividend yield of 4.4% and PER of 8.5
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
29 October – RWS – RWS Holdings – top up
RWS Holdings plc is a provider of technology-enabled language, content, and intellectual property (IP) services. Its segments include Language Services, Regulated Industries, IP Services, and Language and Content Technology (L&CT).
I already hold some. They are suffering as Clients are spending less. Competition from ChatGPT and OpenAI must be an issue, however they own many Patents and you keep seeing horror stories coming out of ChatGPT getting the wrong end of the stick, so hopefully there is a niche for reliable, specialist AI providers. Alternatively they are sitting ducks.
Buy @ 131p with a Dividend yield of 9% (covered 1.5 times normally) and PER of 7
Portfolio %: 1.5%
Total Portfolio Holdings: 2.6%
14 October PSN – Persimmon Homes – reduced Holding
Had a good run with this one. The sale was a top-up after the price had dropped. House market softening.
Sell price: @ £15.92
Buy price: £12.55
Dividend income: 9%
Gain: 36% total (9% + 27%) 19% pa (not compounded)
14 October – IOM – iomart BUY
iomart group PLC is a United Kingdom-based cloud computing company. The Company operates as a cloud computing and information technology (IT) managed services business that is engaged in providing hybrid cloud infrastructure, network connectivity, security, and digital workplace capability.
Cloud computing is where it is at (along with AI). Whilst the market is dominated by the likes of Amazon Web Services there is clearly room for others.
Buy @ 88p with a Dividend yield of 4% and PER of 12
Portfolio %: 1.3%
Total Portfolio Holdings: 1.3%
10 October – LIO – Liontrust – top-up
Liontrust Asset Management PLC is a United Kingdom-based holding company. The Company is engaged in a specialist fund management business.
Since its peak in 2021 it has been on a downward trend, as have a lot of Asset management Companies. There was a lot of euphoria post-COVID and this probably got caught up in it as everything opened up. Harsh reality kicked in and interest rates climbed. I believe it’s been oversold. It’s on a storming, but just covered 15% yield, but even if that were to be halved it will still be pretty impressive.
Interim results highlights
“Net outflows of £1.1 billion in the Period (2023: £1.6 billion).” so outflows, but reduced and that is an industry-wide issue. Already held some of these, so have topped up (previous purchase at 581p)
Buy @ 513p with a Dividend yield of 15% and PER of 7ish
Portfolio %: 1.4%
Total Portfolio Holdings: 2.6%
4 October – HEAD – Headlam BUY
Headlam Group plc is a United Kingdom-based floorcoverings distributor. The principal activities of the Company and its subsidiaries are the sales, marketing, supply and distribution of floorcoverings and certain other ancillary products in the United Kingdom and certain Continental European territories
Again, an out of favour Business due to the softness in housebuilding but can easily see this rebounding once interest rates start dropping and Labour’s house building plans kick in.
Buy @ 130p with a Dividend yield of 4% and no PER as earnings negative for last report.
Portfolio %: 1.4%
Total Portfolio Holdings: 1.4%
3 October TW. – Taylor Wimpey SELL
Got a bit ahead of itself and Housing slowing. better value elsewhere.
Sell price: @ £1.66
Buy price: £1.24
Dividend income: 15%
Gain: 55.5% total (2.5% + 33%) 20% pa (not compounded)
3 October BT.A – BT SELL
Had a near 50% rise in a short length of time. Difficult to see it growing from here.
Sell price: @ £1.43
Buy price: £1.05 (ave.)
Dividend income: 5%
Gain: 41% total (5% + 36%) 70% pa (not compounded)
3 October HFD – Halfords SELL
On reviewing I can’t really make a Business case for them, so have sold at a modest profit. eta, they have continued to climb (currently 167p 3/11) but I’m not concerned. Thin margins.
Sell price: @ £1.46.6
Buy price: £1.41 (ave.)
Dividend income: 3%
Gain: 6% total (3% + 3%) 17% pa (not compounded)
