Tuesday 30 September 2014

Extra stock bought September 2014: Tessenderlo

Tessenderlo, a Belgian chemical company

This investment is by the look of things very crazy. Here I decided to invest in a company that currently runs a negative P/E, ROE, revenue growth and it does not even pay a dividend. Oh, and the P/B is much higher than what I like to see.

Often my companies tend to end up in this situation either the year that I buy them or the year after. Some examples of this are my two banks: Commerzbank and Deutsche Bank. Both have been very poor performers since I started investing in them. K+S have made a large drop in earnings. Asian Bamboo has been the worst of them all with even a change of business concept on top of it all...

Since my years in the Netherlands I understand Dutch spoken as well as written (I have unfortunately forgotten how to speak it as time has passed) and I have been digging into everything I could find out about Luc Tack. In newspapers, interviews you name it and I have either read it or listened to it.

My investment into Tessenderlo was made based on two reasons:

1. Luc Tack
2. the French government is out

There is a saying which says that whenever the Queen sells something then buy it! I did not invest in the Royal Mail when that went public, not that long ago, but I still believe there to be a lot of truth to it. After living some years in France with French bureaucracy I know how they can sit and block things out of purely idiotic reasons and them gone from Tessenderlo means that they will finally be able to make the restructuring that probably has been needed for years. If the French government have really blocked things that I do not know but as I said... it would not surprise me if they have.

The downside here is that they want to quickly sort out the debt situation by bringing in more cash and selling more shares. Usually to deal with those kind of things my broker charge hefty fees so I will see what I can do there to not pay the fees and still try to expand the investment to a full one (meaning around 2,000 € for the time being).

So I bought 45 shares in Tessenderlo at a total cost of 1021.09 € including the fees. This means that each share costed me 22.69 €.

Buying stocks are a little like buying a new car. The second you drive it out of the garage the price drops. At least it is often like that for us mortals due to the fees we pay for trading.

If you want to find out more about Tessenderlo then please go to the analysis of Tessenderlo which is not really some happy reading.

If you want to see my current Stock Portfolio then click on the link but the portfolio will not be fully updated until the end of the month.

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