General commentary
11th February
22nd January. easyjet posted another improved set of results and Mr Market did his usual irrational thing and marked them down. I sold a small tranche last Quarter to shuffle things around. It went into freefall after, so have just bought back in again.
16th January. What a difference a day makes. Yesterday was my best day this year with the announcement of lower than expected UK inflation figures & soft US CPI figures driving a strong Dow & a Gaza ceasefire announcement. Wind forwards 24 hours and a lot of the good work was undone. Whilst there is no point trying to time the market too closely, if you are looking to buy (or sell) it’s good to catch Mr Market in a depressed (or ecstatic) mood. I still want to drive more funds to Safestore (SAFE), but yesterday wasn’t the day. In addition, Housebuilders have been in the doldrums, I’ve been running some rough calculations. TW. came up trumps as best value (IMO). Again, yesterday wasn’t the day though.
Today was the day. I’ve doubled my Safestore holdings and also Taylor Wimpey (TW.) (which was a half New unit before, making it up to a full unit now). Now sitting on 8% cash.
10th January. It’s still looking quite dodgy. Bond yields are rising here, which means the Government’s interest costs are rising. Less headroom to play with tax cuts and higher expenditure to come. Who knows which way an emboldened Trump will jump once he is elected. The aftermath from the tragic fires in Los Angeles are also going to create a large, possibly inflationary, Budget hole, directly with the Government well as higher insurance costs.
I’ve sold down a couple of my elephants today – IMB and BATS. I’m not negative on them at all, but IMB in particular has had a great run and may retrench, allowing me to buy back in at a lower level. If not, then I’m sure that I can recycle the funds into unloved shares. Really want to buy more BYG and SAFE, but – for the moment – I’m sticking to my “buy in after a 10% drop” rule. Rules are made to be broken, however.
I’ve also sold a smaller one, Brickability (BRCK) for a modest profit. If there is a Housing Downturn, then this will get hit. Recent update talked about a ‘soft Market’ back last Autumn. Really don’t think it has improved since.
8th January. Bit of a tense start to the New Year with Trump threatening takeovers of Greenland, Canada and the Panama Canal. In the UK, Labour’s Honeymoon is definitely over, Borrowing costs are rising and interest rates don’t look like they are coming down as rapidly as previously thought.
Whilst 2024 was good to me I do think I’ve spread my net a bit too wide. I have bought a few dubious shares as I don’t want to invest too much per share. My Portfolio has benefited from a large cash injection and I need to develop a higher base level to invest. Mentally this is proving challenging.
In addition, to mix my metaphors, Elephants don’t gallop. In other words I have some large caps that have come back from recent lows, but are unlikely to make as many gains as previous, nor to they have a compelling Dividend return case that would outweigh any Capital falls.
Here’s my Plan for 2025.
- Sell down my tail end stocks – my least favourable ones. I will time the sales with Mr Market’s cheery bouts, however. Not rushing to sell.
- Double my entry point for purchases, so I can hold fewer
- Q1 be a bit more cautious & be happy to hold a bit more cash. Opportunities will come along, they always do.
- Still stick to my 10% drop top-up schedule assuming it’s not for a tangible reason.
- Stick to my sector rotations. I went into Housebuilders a couple of years back. Have done well, although the last month or so has not been impressive. I also bet on Tobacco and Banks. My current out of favour sector is self-store. This has served me well in the past with Lok and Store, and now Safestore and Big Yellow seem very underpriced compared to their Tangible value.
Transactions (on the basis that I’ve doubled my ‘base unit’).
26th March
EVOK – EVOKE – Sell
Trading update today and it wasn’t pretty. This may well be a turnaround share, but it’s weighed down by a lot of debt. I’ve also got quite a few gains in my p/f so this sell crystallises a loss to offset those gains ready to Bed and ISA 6th April. Mitigates my Tax bill a tad. Oh well, take it on the chin. I’ll probably seek something else out once the money is in the ISA.
Sell price: 59p
Buy price: 77p (average)
Dividend income: 0% (non-weighted average)
Loss: 25% total ((25%) + 0% divs) (25%) pa (as I held for pretty much 1 year).
19th February
CRE – Conduit Holdings
Insurer, about 3 years old and growing fast. Been impacted by a couple of storms and the LA wildfires, which isn’t good but (whilst extreme) this comes with the territory. Premiums should harden and I would presume that that area of LA will be rebuilt in a way that it is more impervious to a similar catastrophe. in the meantime, one to tuck away for a solid 7% yield, PE of 4.3 and PEG of 0.1 – what’s not to like?
Buy @ 403p with a d/y of 7.5% and PER of 4.3. Book value of over 600p with half the Market cap in cash.
Portfolio %: 2.6%
Total Portfolio Holdings: 2.6%
Leaves me with about 5% cash, so not much purchasing power for now. In addition, some of that is being held back to plonk into my ISA April 6th (currently in a regular Trading Account, so taxable).
17th February
TATE – Top Up
Normally I wouldn’t top up until it’s dropped at least 10%, however the recent drop after a subdued Trading Update brings it back to my Buy Price, but with a half-unit since I have doubled my Unit purchase size. On that basis and I still have confidence in it, with a pinch of takeover rumours I’ve doubled up to get to my current ‘Unit’ size.
See above reasoning in commentary for today.
Buy @ 572p with a d/y of 3.6% (meh)and PER of 10 (So so).
Portfolio %: 1.3%
Total Portfolio Holdings: 2.6%
11th February
OSB – OSB – Sell
A big part of its Portfolio is Buy to Let and the private landlords are taking a bath right now. Many are selling up. Not sure if that is reflected in the share price (even though they may make up a small part of it) so am selling out anyway.
Sell price: 424p
Buy price: 376p
Dividend income: 0% (non-weighted average)
Gain: 13% total (13% + 0% divs) 24% pa (not compounded) equivalent
22nd January
EZJ – easyJet – Top Up
See above reasoning in commentary for today.
Buy @ 493p with a d/y of3% and PER of 7.
Portfolio %: 1.4%
Total Portfolio Holdings: 8.3%
16th January
TW. – Taylor Wimpey – Top Up
See above reasoning in commentary for today.
Buy @ 109p with a d/y of 8.4% and PER of 11.4. Net Assets of 125p per share, so a bit of a margin of safety there
Portfolio %: 1.4%
Total Portfolio Holdings: 2.6%
SAFE – Safestore – Top Up
See above reasoning in commentary for today.
Buy @ 615p with a d/y of 4.7% and PER of 15.4. Net Assets of 934p per share, so a decent margin of safety there
Portfolio %: 2.9%
Total Portfolio Holdings: 5.8%
13th January
BYG – Big Yellow Group – Top Up
I knew I wouldn’t be able to resist. Bought another Unit. Still can’t see why it’s rated so lowly. Still well over 10% cash, so more firepower available.
Buy @ 883p with a d/y of 5.3% and PER of 15.1. Net Assets of 1300p per share, so a decent margin of safety there
Portfolio %: 2.7%
Total Portfolio Holdings: 5.3%
10th January
BATS – Brit. American Tobacco – Sell
Elephant sale. No real negative, just want to increase my fire power if there is a downturn.
Sell price: 2965p
Buy price: 2630p (ave)
Dividend income: 12% (non-weighted average)
Gain: 24% total (14% + 12%) 32% pa (not compounded) equivalent
IMB – Imperial Tobacco – Sell
Who says elephants can’t gallop (Rudyard Kipling, then adapted by Jim Slater as it happens). IMB has had a stonking run and must be due a retrenchment if there is a downturn and/or Trump comes down on Tobacco Companies as a fundraiser. After a 50% climb I’ve been mulling a sale for a while and pushed the button today. Gutted as it has a low PER and high (and sustainable) D/Y. I just think that I can buy it back cheaper and/or use the funds to buy into something else not in a (no pun intended) dying industry.
Sell price: 2598p (ave)
Buy price: 1785p (ave)
Dividend income: 9% (non-weighted average)
Gain: 54% total (46% + 9%) 53% pa (not compounded) equivalent
BRCK – Brickability – Sell
Wary of a Housing downturn, so this is another sale of a slightly dubious purchase. We need bricks, but if Housing drops, this will drop – and it was already warning of a ‘soft’ Market at its last Report. It was optimistic of a Housing Boost from the incoming Labour Government, but this is turning into smoke and mirrors with Housebuilders very unlikely to hit targets.
Sell price: 59p (ave)
Buy price: 54.5p (ave)
Dividend income: 10% (non-weighted average)
Gain: 17% total (8% + 10%) 12% pa (not compounded) equivalent
8th January
HEAD – Headlam – Sell
One of my riskier purchases. On the face of it, undervalued as it has lot of unlocked property value. On the other hand, will be vulnerable to a housing downturn. Price ticked up after a recent property sale, then stabilised so a good opportunity to get out.
Sell price: 141.5p
Buy price: 130.6p
Dividend income: 0% (non-weighted average)
Gain: 7% total (7% + 0%) 31% pa (not compounded) equivalent
RWS – RWS Holdings – part Sell
Seems a decent Business, but it fell in price after I bought it. This is a sale of the subsequent top-up to crystallise the gains. Nothing negative against it and if it drops again I’ll rinse and repeat. Selling ahead of x/d next week.
Sell price: 178.7p
Buy price: 131.4p
Dividend income: 0% (non-weighted average)
Gain: 35% total (35% + 0%) 178% pa (not compounded) equivalent
NWG – NatWest Group – Sell
Elephants don’t gallop. I had a bit of angst about this. It is still a good Business, and I bought in when Mr Market had a bad reaction to some quite reasonable results. Since then both tranches have hit a 100%+ Gain and I just feel that I can’t see it making any decent returns from this valuation & can deploy the cash more effectively. I’ve set a buy-in price in case it all goes horribly wrong again.
Sell price: 403p
Buy price: 192p (average or two tranches)
Dividend income: 9% (non-weighted average)
Gain: 117% total (111% + 9%) 97% pa (not compounded) equivalent
BYG – Big Yellow Group – BUY
As mentioned, above, the self-storage Market overall seems to be undervalued. Valuations rose 2021/2022 post Covid as Business and individuals reined in spending and had to mothball stuff (although self-storage is not a cheap option, often costing more than what is stored). Anyway, since 2020 it’s all been on a downward slope and as far as I can see, at the moment, once you subtract net debt, the Businesses are undervalued by about 30-40% on NTAV alone, never mind income. I can’t see any reason for this and feel it will revert to the Mean, or be snapped up. Self-storage is a bigger thing in the US for instance and Businesses there might be looking to expand into the UK, especially if the £ keeps falling. Back to reality and I’ve already invested in Safestore, so bough a Unit (new double size unit) of Big Yellow today. Will be happy to top up either if they drop by another 10%.
Buy @ 899p with a d/y of 5.1% and PER of 15.6. Net Assets of 1300p per share, so a decent margin of safety there
Portfolio %: 2.7%
Total Portfolio Holdings: 2.7%
As you can see, the doubling of the Base Unit means new Purchases are approaching a 3% holding each time.
Currently that still leaves me 6% in cash, which is as high as it’s been for a while.
Watchlist snippets after today’s tidy up: PETS, ABDN, VSVS, WPP – and NWG if it drops back a decent amount. None are screaming ‘buy’, so am watching & waiting….
Dithering: IMB has climbed so much, but is still at a stonkingly good price.
Not sure: DOM has done me well in the past, despite never being particularly cheap on metrics. Getting relatively cheap again, so could buy for the cycle….
Fantasy: PIER – Brighton Pier Group. Heart, not head here. Wouldn’t it be fun to own a bit of Brighton Pier? At the rate it’s valuation is going, I could own a decent size.
