Contrarian stock bought June 2014: Deutsche Bank (DB)

As many of you probably know I am very unhappy with the management of Deutsche Bank and their dealings but it was and still is a contrarian company so I guess being annoyed is part of the deal. I mentioned in my previous article concerning DB which was in Dividend from Deutsche Bank - May 2014 that they will increase the amount of shares and are selling the new ones for 22.5 € per share.

Last time this happened to me was with Commerzbank back in 2013 (see Commerzbank board of thieves) and the price for the shares were even more ludicrous which meant that I really wanted to join in but since I did not fully understand the German papers I had received and I did not go and ask my broker about what I should have done so I failed to join in on that offer which has since then become a huge loss to me.

So this time I made sure that I fully understood the papers and I filled them out correctly which meant that I ended up paying (with fees) 1206.3 € for 53 additional shares.

This means that I currently have 241 shares in Deutsche Bank and my average price is at 28.68 € per share. If you want to take a closer look at DB then please see the analysis of DB 2014.

With the next update of the monthly report the new change will be brought in to the Stock Portfolio.

It became a bit too many buys this month but this last one I was forced to do and the previous ones were also musts but I simply had not had the money before to buy them during the spring. In the future I will go back to the more relaxed approach of one new investment per month for around 1000 €.

In Sweden, where I follow a lot of bloggers (please check out "The blogs I follow" with any blog name having (SE) behind it), they have started to build up cash positions and are waiting for the companies they follow to drop in price. Personally I find that too risky and I prefer to jump into other more contrarian markets and new companies with a low valuation.

My risk is... a new market and a new company which could lead to a new chance to fail. Their risk is to never enter the stock market again (which is less likely) but more likely is that they end up waiting for a long time.

Statistics does however indicate that it is time for a -20% correction any time now but that is the market and I am busy buying individual companies and if I look at the companies on DAX then many of them that I do not own today could easily survive a 30-40% correction and STILL be overvalued in my eyes.

 

Dividend from BP: June 2014

My British contrarian company BP paid yet another quarter dividend to me. I currently hold 354 shares and I was paid 0.058071 GBP per share which gave a total of 20.56 GBP and after the conversion to euro I got 25.71 € cash in my hand to invest as I see fit.

The share price for BP has kept increasing lately and most likely that is due to their own share buy-back program but that I have no issues with since it has a triple effect:

• Potentially increased share price (based on how big volumes they go after)
• No taxes paid (compared to paying out dividend to me that I pay tax on)
• My share of the future earnings increases.

All three things makes me happy and actually even more than getting cash in my hand in the form of dividend. To get a closer look on BP then please see the analysis of BP 2014.

The Stock Dividends page has now been updated.
 

Analysis of Volkswagen (VW) 2014

Company: Volkswagen (VW)

Business: A German automobile manufacturer. The are producing motorcycles, cars, trucks, large-bore diesel engines, turbochargers, turbo machinery, compressors and chemical reactors. They are however most famous for their cars and here are the Volkswagen brands.

Active: They have world wide presence and sell their products in 153 countries and have production sites in 27 of those.

P/E: 9.9

Analysis of ThyssenKrupp 2014

Company: ThyssenKrupp

Business: A German steel and steel products company.  They are dividend into six business areas: Components Technology (assembled camshafts and ready-to-install net-machined crankshafts and engine components), Elevator Technology (passenger and freight elevators, escalators, moving walks, passenger boarding bridges as well as stair and platform lifts), Industrial Solutions (design and construction of chemical plants, refineries and other industrial facilities), Materials Services (carbon and stainless steel, tubes and pipes, nonferrous metals and plastics), Steel Europe (carbon steel flat products) and finally Steel America (production, processing and marketing of premium carbon steel products).

Active: Present in over 80 countries world wide.

P/E: -8.6 (P/E5: even worse!)

Deutsche Beteiligungs AG (DBAG) report Q2 2014

 

My only investment and holding company arrived with their Q2 report for 2014 and here is the summary of what I found in this publicly available report. The share price did not move much either on the day of the report or any other day this quarter for that matter. The biggest movement this year was simply when they paid out the dividend and the share price dropped with an equal amount.

Analysis of Siemens 2014

Company: Siemens

Business: A German electrical engineering company. They are divided into four sectors: Energy (generate, transmit and distribute electrical power at the highest levels of efficiency), Healthcare (medicinal equipment, analytical equipment etc.), Industry (automation technology, industrial control and drive technology as well as industrial software) and finally Infrastructure & Cities (integrated mobility solutions, building and security systems, power distribution equipment and smart grid applications).

Active: World wide with activities in over 190 countries.

P/E: 20.2

Analysis of SAP 2014

Company: SAP

Business: A German software and software related services company. They are currently offering five lines of products: Business Application, Database & Technology, Analytics, Cloud and finally Mobile. By reading their own explanations for what their products could do I must say that the language was non descriptive and weak. Happily they do business to business sales.

Active: Customers in 188 countries and employees in 130 of those. They have 3.8 customers per employee.

P/E: 21.0

Contrarian stock bought June 2014: Cez

As mentioned not that long ago it was yet again time to start investing since the money that was allocated to a potentially expensive move in the end was not needed and had to be put to better use. I previously also mentioned that I am due to a tough spring behind schedule with my investments and I hope to be able to catch up with making the around 1,000 € investment per month.
This means that after this investment I am only 1,000 euro behind that schedule and with some extra squeezing of my lifestyle plus sharing an extremely cheap apartment now with my girlfriend I see no reason for why it should not be possible.

I therefore decided to increase my position in Cez, go here for the analysis of Cez 2014, since it was simply too small for making any large impact, which will most likely take a while until it arrives anyway but in the meantime I expect nice dividends.

I bought an additional 50 shares in Cez and I paid, including fees, 21.65 €. In total I now own 100 shares in Cez and the average price is 21.42 € per share. On the 27th of June during the annual meeting the dividend will most likely be fixed to 40 CZK which was proposed which should then give me around 140 euro. It will be interesting to see what kind of taxes will be removed from that.

With the next update of the monthly report the new change will be brought in to the Stock Portfolio.

Analysis of RWE 2014

Company: RWE

Business: A German electricity and gas company. This fifth largest electricity producer in EU are using the entire mixture of gas, coal, nuclear and renewable for the production. RWE currently run five business unites: Production (lignite, gas and oil), Power Generation (the generated electricity from all the different sources), Supply & Trading (buying and selling of electricity, gas and oil), Transmission & Distribution (electricity, gas and water grids) and finally Products & Services (sales of electricity to residential and commercial customers).

Active: Europe, North Africa and Turkmenistan

P/E: -6.8 (P/E5: 12.1)

Kernel report Q3 2014

My Ukrainian logistics and agricultural company arrived with their Q3 report for 2014. It had an uplifting beat to it but in my eyes things are not fine and even though they clearly say that all their operational units are not in the parts where people are fighting it still will have a large impact on them. So what was then in the report? The full version of the Kernel Q3 2014 report.

Analysis of Merck 2014

Company: Merck

Business: A German biopharmaceutical and chemical company. It is currently operated as four divisions: Merck Serono (56% of revenue, biopharmaceuticals that focus on cancer, MS, infertility and cardiovascular diseases), Consumer Health (4% of sales, over the counter drug example of brands: Bion, Seven Seas and Kytta), Performance Materials (15% of sales, high-tech chemicals such as liquid crystals for electronics, plastics etc.) and finally Merck Millipore (25% of revenue, supply tools within the life science field).

Active: Product sales in over 150 countries with research hubs on three continents.

P/E: 23.2 (Updated P/E due to a mistake in quantity of share)

Dividend from Intel: June 2014

The American giant Intel sticks to classical US traditions and pay dividends each quarter. For each share I received 0.225 USD which then gives me for my 100 shares 22.5 USD that which conversion to euro becomes 16.5 €. On this I have to pay 15% taxes (-2.48 €) and I end up with 14.02 € added to my account.

Lately there has been some good news from Intel which has significantly pushed up the share price. The reason has been connected to increased sale of desktop units to businesses. It is interesting to follow how dependent Intel is to Microsoft and their decision to stop updating an operating system (this time XP). By the look of it... when a new operating system has to be bought the companies decide to directly buy new desktops computers. Please go here for the analysis of Intel 2014.

The Stock Dividends page has now been updated.
 

Analysis of Lufthansa 2014

 

Company: Lufthansa

Business: A German aviation company that are divided into five segments: Passenger Airline Group (transporting over 100 million people per year to 106 countries and 274 destinations), Logistics (airfreight to around 300 destinations), Maintenance, Repair & Overhaul (repair services to over 770 airlines), Catering (30% market share with LSG Sky Chefs) and finally IT Services (consultancy to 300 other airlines as well as to 150 non airline customers). 

Active: World wide with presence in over 100 countries.

P/E: 23.7

Asian Bamboo report Q1 2014

Asian Bamboo arrived some time ago with their Q1 report and here is the summary from that. The drop due to the report was not very significant which was probably mainly due to the significant drop that happened when the annual report was published. Go here for the summary of Asian Bamboo annual report 2013.

Analysis of Linde 2014

Company: Linde

Business: A German gas & engineering company. It is divided into three divisions: Gases (production and distribution of gases ranging from oxygen to acetylene and argon), Engineering (engineer and construction of industrial plants for gas extraction) as well as Gist (logistics and supply of gas products).

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

P/E: 22.0

Dividend from E.On: May 2014

There was also a second company that paid out the dividend to me during May and that was E.On. as I have previously mentioned they cut their dividend payments from the wonderful 1.1 € per share to 50-60% of the earnings which this time gave me 0.6 € per share and a total of 144 € for my 240 shares.

In total I have now received 528 € (14% of the invested money) from E.On. during the three years I have been a shareholder. The first year I additionally only owned 120 shares. So even though they have cut their dividend I am sure that I will collect a nice amount also in the future. Here you can find the previous analysis of E.On. 2014.


The Stock Dividends page has now been updated.

 

Analysis of Lanxess 2014

Company: Lanxess

Business: A German specialty chemicals company. They are divided into three segments and several Lanxess business units (too many to list here) but the segments are: Performance Polymers (~0.05% of the revenue... why is it even a segment? they make synthetic rubber and plastic manufacturing) , Advanced Intermediates (~20% of the revenue, basic and fine chemicals) and finally Performance Chemicals (~26% of the revenue, for instance organic plastic colorants). Odd that the three company segments does not even cover 50% of the total revenue for Lanxess...

Active: They are currently active on every continent in the world and in total in 31 countries.

P/E: -28.9 (P/E5: 18.0)

Analysis of General Mills

Company: General Mills

Business: An American food company. They have a large portfolio of products within Baking Products, Cereals, Ice Cream, Meals, Pasta, Pizza, Snacks, Vegetables and Yogurt. Some of the well known brands are: Cheerios, Green Giant, Häagen-Dazs, Old El Paso, Wheaties and Yoplait. For the full list of General Mills brands.

Active: World wide with sale of products in over 100 countries and manufacturing in 30 of those.

P/E: 19.8

Dividend from Deutsche Bank (DB): May 2014

In end of May there was a dividend payment from Deutsche Bank. Since the last five years they have been paying out 0.75 € per share. I currently hold 188 shares which means that I received 141 €.

The Stock Dividends page has now been updated.

With Deutsche Bank there is currently a secondary matter. Since the management is completely useless and they are apparently involved in more litigations than what they had expected it obviously was not enough to only sell more shares to institutions 8which they did last year) and now they are asking each shareholder to push in more money (which is the cause for the current massive drops in share price).

What we shareholder gets is the pre-emptive rights in the equivalent of the amount of shares that we currently are holding. Meaning that I receive 188 pre-emptive rights. These rights I can buy more of or I can decide to sell them. Currently they are being traded around 1.60 €.

To buy one new share I have to spend 3.6 pre-emptive rights which means that I end up having the right to buy 52.22 new shares at the price of 22.5 euro per share. I am in a letter offered five possibilities:

1. I can buy 2.8 more pre-emptive rights and then buy 53 new shares. Total cost around 1196.98 € plus commission fees and I will have a total of 241 shares.

2. I can sell 0.8 pre-emptive rights and then buy 52 new shares. Total cost around 1168.72 € plus commission fees and I will have a total of 240 shares.

3. I can buy x amount of extra pre-emptive rights and y amount of shares + commission.

4. I can sell z amount of pre-emptive rights and t amount of shares - commission.

5. Sell all my pre-emptive right. Giving me a total of 300.8 € - commission and having a total of 188 shares.

The commission fees tend to be crazy high around 20 € for these things which annoys me severely and additionally I have only ten days to come up with the money needed to join in this madness created by an incompetent management that thought they were clever when they calculated profit against the risk and price for any potential litigations.

Stop doing illegal things and start running the business with some competence!

Here you can find the previous analysis of Deutsche Bank 2014.

 

Contrarian stock bought June 2014: DBAG

Now that my move is finished and I managed to get away with less costs than expected I could invest part of the temporary buffer that I had built up. There are some larger costs on the horizon such as buying a new bicycle with a good lock, booking the vacation trip and I also have to get service the official check-up of my car to be allowed to drive it for the next two years. According to my calculations the costs for the above mentioned things will be in the range of 700 euro so...

I therefore decided to increase my position in a company that I already own and that was Deutsche Beteiligungs AG. Here is the previous analysis of Deutsche Beteiligungs AG.

The position was increased with 50 shares and including the trading fee I ended up paying 20.07 € per share which gives me today a total amount of 100 shares at the average price of 20.14 € per share. I am looking forward to remaining as a shareholder in DBAG for a long time.

With the next update of the monthly report the new change will be brought in to the Stock Portfolio.
 

Analysis of Infineon 2014

Company: Infineon

Business: A German semiconductor company. They have three focus areas: Energy Efficiency, Mobility and Security but the four business areas are: Automotive (chips manufacturing), Industrial Power Control (components for industrial applications), Power Management & Multimarket (power components for high frequency applications and smart grids) and finally Chip Card & Security (security systems for passports).

Active: Mainly in Europe. Some expansion into Asia and the US.

P/E: 37.9

Pershing Square: William Ackman Q1 2014

Major activity also from William! I have not seen him that active before so this is very interesting. The previous report concerning Pershing Square - William Ackman Q4 2013 and what they bought and sold.

The new companies that he brought it were:

Allergan Inc - a healthcare company dealing with medical devices as well as over the counter products.

Apartment Invt & Mgmt Co (AIMCO) - they are renting out apartments and houses in several US states.

Analysis of Henkel 2014

Company: Henkel

Business: A German consumer products company that are divided into three business units: Laundry & Home Care (28% of revenue, product examples: Persil, Purex and Pril) , Beauty Care (21% of revenue, product examples: Schwarzkopf, Dial and Syoss) and finally Adhesive Technologies (50% of revenue, product examples: Loctite, Teroson and Technomelt).

Active: They are present in over 70 countries world wide.

P/E: 23.5

Greenlight Capital: David Einhorn Q1 2014

David Einhorn tends to be a very active investor and also this quarter there has been several changes to the stock portfolio. Here you can find the previous analysis of the dealings for Greenlight Capital and David Einhorn Q4 2013.

The new stocks were:

Analysis of Heidelberg Cement 2014

Company: Heidelberg Cement

Business: A German manufacturer of building materials. They are the global market leader in aggregates and a prominent player in the fields of cement, concrete and other downstream activities such as ready-mixed concrete, concrete products and concrete elements.

Active: They are active in over 40 countries with 2,500 locations.

P/E: 16.2