British Petroleum report Q3 2013

 

A few days ago British Petroleum delivered their third quarter report, which can be found here. Last thing I heard from the BP management was that they were annoyed with how they were being treated in the US legal system and had therefore decided to put their foot down. At least they themselves claimed that they wanted to do the correct thing and pay for the damages that had occurred but have now started to feel abused since anyone was getting money without having, once again according to them, legitimate claims on them and especially the lawyers were getting far too much money.

Deutsche Bank report Q3 2013

Yesterday Deutsche Bank came out with their third quarter report for 2013 and it can be found here. As I expected, due to the inside trading that I reported about both here for September as well as here for August where the management and board of Deutsche Bank have been selling huge quantities of stocks, the result was very poor. I did not expect it to be as poor is it was though.

Analysis of Hannover Rückversicherung

Company: Hannover Rückversicherung

Business: A German reinsurance company. It is divided into two business group: Non-Life Reinsurance (with a subdivision that focus strongly on North America and Germany) and the second one is Life and Health Reinsurance. The two division have fairly equal revenue size.

Active: They claim they are one of the leading reinsurance companies in the world with world wide presence.

P/E: 8.3

Comment: Talanx an insurance company that are also on the MDax list owns 50.2% of Hannover Rückversicherung.

Analysis of Westag & Getalit

Company: Westag & Getalit

Business: A German producer of wood based as well as synthetic products (such as the well known laminates). They are divided into three divisions: Plywood/Formwork (used to stabilize concrete as well as interior floor in vans and delivery trucks etc.), Doors/Frames (exactly like it sounds like) and finally Laminates/Elements (mainly for kitchen and furniture and not floor as maybe one think of at first when hearing laminate)

Active: Mainly in Germany with 80% of their sales and 20% is export to the rest of Europe.

P/E: 13.4

All the companies on DAX

I have now managed to go through the entire list of companies on DAX and have analysed them according to the contrarian approach that I have set out to be my way of investing. Many of the companies are expensive at the moment but some of them are unreasonably cheap. In the list below will be the links to each analysis and the P/E (at the time of when the analysis was made) of the company if you have missed one of them in the past.

On different note... I have made some changes to the blog because I found that the template I was using served little purpose and was just slowing down the speed. I am still fiddling around with the look of it and if you have any comments and remarks regarding it then please just let me know so that I can change things for the benefit of everyone.

Analysis of Volkswagen (VW)

Company: Volkswagen

Business: A German automobile producer that are currently the third largest in the world. VW do not only produce cars but also trucks, buses and engines for heavy industry and ships. They have several brands today and to mention a few: VW, MAN, Scania, Bugatti, Lamborghini, SEAT etc. for a more complete list please look here.

Active: They are active world wide and are selling their vehicles in 153 countries as of today.

P/E: 3.8

Analysis of Siemens

Company: Siemens

Business: A German company active with electrical engineering as well as electrics. They are divided into four sectors: Energy, Healthcare, Industry and finally Infrastructure and Cities. The revenue is fairly well balanced between the sectors and so is usually also the profit besides from the Infrastructure that has been doing a little less good lately.

Active: They are present world wide by being active in 190 countries with over 290 production plants to keep their 370,000 employees active.

P/E: 18.2

Analysis of SAP

Company: SAP

Business: A German software and software related services company that are dividing themselves into five units: Software, Support, Cloud, Consulting and Other services. The biggest revenue source is from Support with 51%.

Active: They are active in 188 countries and are servicing over 251,000 clients (which is companies and institutes).

P/E: 24.9

Companies and headquarters

I very recently read an article at ARD which can be found here (unfortunately it is in German but the most important thing are the images/drawing that can be seen there and not the text as such.

In this article they were going through a couple of revenue giants that are currently on the top of the world (the links are to analysis that I have previously made of them): Apple, Facebook, Samsung, Nvidia, Google and Amazon.

Analysis of RWE

Company: RWE

Business: The second biggest electricity and gas company in Germany and the fifth biggest in Europe. They are producing their energy from gas, coal , nuclear and renewable. They divide themselves into five business unites: Production, Power and Heat Generation, Supply and Trading, Transmission and Distribution and finally Products and Services.

Active: In the European union.

P/E: 12.8

Analysis of Merck

Company: Merck

Business: A German pharmaceutical and chemical company that are divided into four business units: Merck Serono (biopharmaceuticals the largest division working with highly innovative biopharmaceuticals), Consumer Health (which is over the counter pharmaceuticals to improve customers health), Performance Materials (offer high tech chemical materials to clients working with electronics, plastics etc.) and finally Merck Millipore (supply tools within the life science field).

Active: They are present world wide. Currently they are selling their products and brands in more than 150 countries

P/E: 13.6

Comment: Only 30% of the shares are publicly traded of Merck, the rest is owned by the Merck family.

Analysis of Lufthansa

Company: Lufthansa

Business: A German aviation company that are divided into five segments: Passenger Airline Group (transporting over 100 million people per year, 32% of profit), Logistics (airfreight, 13% of profit), Services (repair services to over 700 airlines, 40% of profit), Catering (27% market share with LSG Sky Chefs, 12% of profit) and finally IT Services (consultancy to other airlines etc., 3% of profit)

Active: They are active world wide either on their own or though affiliates.

P/E: 6.7

Comment: On the executive board two out of five are women which to my knowledge tends to lead to more long-term strategy goals with focus on value growth but I might be wrong.

Analysis of Linde

Company: Linde

Business: A German gases and engineering company that are divided into three divisions: Industrial Gases & Healthcare (production and distribution of all kind of gases ranging from oxygen to acetylene and argon), Engineering (engineer and construct industrial plants for gas extraction) as well as Gist (contract logistics and supply chain not only of gas products but also refrigerated and "normal").

Active: They are active world wide and are currently present in over 100 countries.

P/E: 21.0

Analysis of Lanxess

Company: Lanxess

Business: A German specialty chemicals company that are focusing on plastics, rubber, intermediates and specialty chemicals. They are divided into three segments and several business units (too many to list here) but the segments are: Performance Polymers, Advanced Intermediates and finally Performance Chemicals.

Active: They are present on every continent in the world with the heaviest focus in Europe and Germany.

P/E: 8.0

Intel report Q3 2013

The American companies are much faster then the European and German ones when it comes to pushing out their financial quarter reports. They also tend to be short and tell only the main points without containing a multitude of coloured pictures which looks flashy but really does not make me want to own the company since that decreases the company earnings and my dividend.

The third quarter report from Intel is still hot from the press (please find it here) and I directly jumped on it to take a look at how my one and only US company is doing over on the other side of the Atlantic ocean.

Analysis of Infineon

Company: Infineon

Business: A German semiconductor company that are currently trying to push their focus areas as being: Energy Efficiency, Mobility and Security. I prefer the older approach of: Automotive for which they produce chips, Industrial Power Control in which they are making components for industrial applications, Power Management and Multimarket which is power components for high frequency applications and finally Chip Card & Security for instance are they making the security systems in the passports.

Active: Mainly in Europe and very heavily in Germany due to their products and the car industry here. They have some expansion into the US and Asia.

P/E: 18.5

Comment: I found their homepage to be awful! It looks like a over crowded technology page for serious computer nerds. They should spend some money on making their homepage easier and more visitor friendly.

New stock bought October 2013

I decided to make an increase of my shares in K+S and bought an additional 55 shares for the price of 18.72 € per share. This now gives me a total amount of shares in K+S of 105 and the average price per shares including fees now ends up at 20.00 €.

I will try to stick to this trend of investing for around 1000 euros per month and it should at least be possible also next month due to the large transfer that I made in the end of September 2013.

Analysis of Henkel

Company: Henkel

Business: A German consumer products company that are divided into three business units: Laundry and Home Care, Beauty Care and finally Adhesive Technologies. Many of you have probably used their products already just a few examples: Persil, Schwarzkopf, Pritt, Pril and Purex.

Active: They are present all over the world with their products and brands.

P/E: 21.4

Analysis of Heidelberg Cement

Company: Heidelberg Cement

Business: A German building / construction material company. They have two groups cement (which is the centre and core of their business) and aggregates which includes gravel, crushed rock and sand. Until the 1960´s they were only present in the south of Germany but since then they have grown by taking over competitors in different regions of the world.

Active: Currently present in 40 countries often also with production sites all over the world.

P/E: 36.3

Contacted by concerned investor

Yesterday I received an email in my function as CEO from a concerned investor that were wondering if my company and the company he has invested in could not cooperate to decrease material costs that seems to be expanding exponential in his investment. Here I quote "It would be a win-win situation!".

Since the company is working in a similar field to mine but are as of yet still not a direct competitor I know their products but I have not looked into their financial situation for the last couple of years. I quickly took a look at it last night to see if anything had changed.

Analysis of Fresenius

Company: Fresenius

Business: A German health care company: They own fully or parts of: Fresenius Medical Care (analysed previously) that work with dialysis, Fresenius Kabi treatment of chronically ill patients, Fresenius Helios which is 74 hospitals and clinics (in Germany mainly) for acute treatment of patients, Fresenius Vamed helps with projects and management business of health care facilities, Fresenius Netcare and finally Fresenius Biotech (both are very small in comparison to the others)

Active: They or their daughter companies are active world wide but with a strong base in Germany and Europe for many of their products / services.

P/E: 17.3

Analysis of Fresenius Medical Care (FMC)

Company: Fresenius Medical Care (FMC)

Business: A German medicinal products and service company. FMC is owned to 30% by Fresenius that are also on DAX and will be analysed tomorrow. FMC are active in the field of dialysis. They are providing hospitals, clinics with highly professional equipment as well as private people so that they can perform the dialysis at home on their own. The maintenance of the equipment and the exchange of filters is a growing market year by year. They also have a total of 3200 dialysis clinics in the world of which 2100 is situated in North America.

Active: They are selling their dialysis equipment world wide and their dialysis clinics are available in 40 countries.

P/E: 12.2

How to turn (some) Governmental costs into profits?

I want to start this reflection article by two quotes which I find important for this article and the first one is from: 1 Corinthians 13:11 which says that "When I was a child, I spoke like a child, I thought like a child. When I became a man, I gave up childish ways."

The second quote concerns Richard Feynman's problem solving algorithm.

"1. Write down the problem.
  2. Think hard about the problem
  3. Write down the solution to the problem."

Analysis of Deutsche Telekom

Company: Deutsche Telekom

Business: The German telecom company (still today owned to almost 15% by the German government) that provides all the classical telecom services. They are divided into three groups: Consumer (Fixed, Mobile & Broadband, Cloud Services, Television), Business Customers (Information, Communication & Technology Solutions, Outsourcing & Cloud Services etc.) and finally Partner Services & Platforms (Partner for infrastructure access and network services, Platform & Cooperation projects).

Active: They are represented in over 50 countries world wide. However the strongest focus is still in Europe and more specifically in Germany.

P/E: -9.2 (they took a 10 billion € depreciation or better put loss of value in 2012)

Analysis of Deutsche Post

Company: Deutsche Post

Business: A German global mail and logistics company: They are divided into four divisions: Mail, Express, Global forwarding (freight) and Supply chain.

Active: They are active world wide and are present (at least with outgoing mails) to 220 countries. a bigger surprise is that they employ 475,000 people world wide which means that they are one of the 10th biggest employer in the world which is impressive!

P/E: 17.7