Analysis of Avtovaz 2016

Company: Avtovaz 

ISIN US05453R1014 | WKN 576848

Business: A Russian automotive company. They are the biggest personal car producer in Russia with their own brand, Lada, as well as having production for, for instance, Renault and Nissan which are their largest shareholders. Today they have almost 20% of the Russian market and they hope to increase that as well as increasing export.

Active: In 46 countries with the biggest market being Russia.

P/E: -0.3

Avtovaz annual report 2015

My Russian car company Avtovaz have arrived with their full year report and the reading was not pretty... not pretty at all.

Analysis of Standard Chartered

Company: Standard Chartered

ISIN GB0004082847 | WKN 859123

Business: An UK head-quartered international bank. They are standing on three pillars: Personal Banking (savings, accounts, mortgage, loans, insurance etc.), Private Banking (focused on wealth management) and the final pillar is Business Banking (transactions, financial markets, corporate finance, renminbi services as well as Islamic Banking). It should be mentioned that 69% of revenue comes from Asia of which 33% is directly in connection to Greater China.

Active: 67 countries world wide. 

P/E: -8.9 (P/E5: 6.8)

ABF operating report Q1 2016

Associated British Foods, one of my few very successful holdings, arrived with their operating report for the first quarter of 2016.

The report in full can be found here and for the previous report please visit ABF annual report 2015 and to find out more regarding ABF then please check out the analysis of ABF 2015.

There is not that much to say regarding this report because there is not much in it however many of their business units have improved their performance and of course especially Primark has been doing very well if one excludes the currency effects. Including the currency effect and all their businesses are showing weak results. They mentioned once again that the sugar prices are increasing due to poor harvests and that they unfortunately will not be able to profit from that during the coming year because they have already fixed contracts. They hope it will be better one year from now for the sugar business but it is definitely sure that 2016 will be yet another bad year.

Aquamarine Capital: Guy Spier Q4 2015

Now we come to the chiller of the chillers (at least when it comes to stocks on the US market). Mr. Spier have had an extraordinary activity during the last quarter!

For the previous report please click on Aquamarine Capital: Guy Spier Q3 2015.

Conclusion: It might look boring but to me it is highly interesting. Mr. Spier entered earlier into Berkshire than Mr. Pabrai. he also keep holdings longer than not only Berkshire but also what Mr. Pabrai is doing, for instance Posco. To me this means that Mr. Spier have completely different sales criteria than what Mr. Buffett and Mr. Pabrai have. Very interesting!

Source: SEC

Pershing Square: William Ackman Q4 2015

Ooh, William had another laid back quarter, at least in terms of activities that has to be registered with the SEC. So he did more or less nothing and still he was loosing a big chunk of money on one of his holdings. Guess which one?

For the previous report please visit Pershing Square: William Ackman Q3 2015.

Conclusion: Well let us start off with answering the question above - Valeant is the company causing all the grief. Not only to the investors but also to the American population that have been forced to pay outrageous bills for medication that costs almost nothing to produce. Valeant is a vulture company whose existent should be questioned. In some cases governments should start to consider having their own generics company to provide their population with cheap medication as being part of the crucial infrastructure of the nation.

Source: SEC

Greenlight Capital: David Einhorn Q4 2015

If hedge fund manager desperation could be drawn up in table then it would probably look pretty much like what we have below. This is like a poker player playing each hand in an attempt to recover the losses. Wooow, is all I can say to this activity. When the hedge fund went well he did very few changes... maybe he should sit down and take a time out to get back on track again.

For the previous report please visit Greenlight Capital: David Einhorn Q3 2015.

The new additions were:

Dalal Street: Mohnish Pabrai Q4 2015

Activity increased somewhat during the quarter and my guess is that the activity in Q1 2016 will be extreme for all the managers... IF they had some cash around to use that is.

For the previous summary please visit Dalal Street: Mohnish Pabrai Q3 2015.

The new holding was:

Berkshire Hathaway - An American conglomerate that is run by Warren Buffett and Charlie Munger.

Conclusion: Ouch, Mr. Pabrai decided to kick out Posco. That was a big surprise. He must have had a loss of around -50% on that one. It is one of the best steel companies in the world but obviously Mr. Pabrai is no longer confident regarding when the prices for steel will go up again. It is also not the first time that he parks his money in Berkshire Hathaway when the share price there has come down to a more comfortable level. Oh, and of course his Google shares got converted to Alphabet so that is not a new holding. He also decreased in General motors and in WL Ross.

Source: SEC

Analysis of Tessenderlo 2016

Company: Tessenderlo 

ISIN BE0003555639 | WKN 852064

Business: A Belgian chemical company. They currently have three operating segments : Agro (~40% of revenue with liquid crop nutrients, water soluble SOP and crop protection), Bio-Valorization (~31% of revenue with gelatine, pharmaceuticals, body-care and bio-resources) and finally Industrial Solutions (~29% of revenue with pipes, water treatment and mining).

Active: 21 countries and 100 locations.

P/E: 14.5

Tessenderlo annual report 2015

Tessenderlo arrived with an ok report which made the share price increase by over 12%. Silly is probably the word I want to use for that kind of share price movements. What was then in it?

Berkshire Hathaway: Warren Buffett Q4 2015

This time around Berkshire did not play any tricks on us. Generally there was so little activity that my guess is that Warren and Charlie have gone into hibernation during the cold US winter that is currently roaming.

The new holding:

Kinder Morgan - An American energy infrastructure company. They have several pipelines for gas and oil as well as energy storage space.

Analysis of Eniro 2016

Company: Eniro

ISIN SE0000718017 | WKN 579941

Business: A Swedish search and advertisement company. They have two business units: Digital Search (concerning 69% of revenue and involves desktop, mobile and additional digital products) and Print/Voice (31% of revenue and was the old revenue and earnings base for Eniro)

Active: Sweden, Denmark, Norway, Finland and in Poland.

P/E: -0.2 (P/E5 is not an improvement)

Eniro annual report 2015

The report from Eniro was very poorly accepted. It more or less directly took a nose dive of around -10% which is a lot but in these times of extremes I am no longer astonished by such movements. I heard the conference that was given upon the release. Very sad. Even a high school presentation by a shy and awkward kid would have been better and this from a company that have been trying to step into the mobile world... no wonder they only try and do not really succeed. I mean they were even asking someone to bring up the next slide in the presentation. Seriously!?

Extra stock bought February 2016: BASF

As I mentioned I before these kind of general drops in share prices means that one have to try to buy as much as possible. Sure the knife will keep falling a bit further but who cares?! We are able to pick up excellent companies at very fair prices! I therefore decided to use the 1k € buffer that I keep on the broker account to increase the February investment to become in total around 3k €. I am sure, given time, that these 3k € that I now pushed into already owned holdings will serve me very well over the coming years.

BASF is falling far too much due to their involvement in the oil and gas business. The other part of the company (the large one) will however show a significant profit due to increased margins on their polymer and other added value products. This increased margin effect is not following the oil price drop as quickly but I expect it to arrive. This is of course only my own thoughts regarding the matter so do not understand that as being anything factual.

This German chemical giant is yet another one of those easy investments. They pay out a solid dividend of above 4% and are being traded at a P/E of around 10 right now. Their entire organisation is built up by poorly-innovative, yet knowledge-wise highly skilled chemists that are selling bulk quantities of highly value added products. They are a bit like Intel. They grind down their competitors slowly but surely.

I therefore bought an additional 16 shares in BASF at a total cost of 1000.51 € including fees. This means that I know hold 47 shares in BASF at a total cost of 3013 € which comes down to 64.11 € per share including the trading fees.

To find out more regarding BASF then please take a closer look at analysis of BASF 2015.

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.

Analysed requests from 2015

In 2015 I received a fair amount of requests on the Analysis Requests page. To check out my previous summary then please visit analysed requests from 2014 and by following that one step further back you will find how the colour coding works.

What we can see is that Graham got four green ones and four red ones so 50% accuracy in the selection and for me I got three green ones and three red ones so also I got 50% accuracy in the selection. So far so good!

Analysis of Apple 2016

Company: Apple 

ISIN US0378331005 | WKN 865985 

Business: An American technology and design company. They have products that they market very well. Their products are, in order of revenue: iPhone (major income source), iPad, Mac, iTunes, iPod. Watch.

Active: World Wide 

P/E: 10.3

Extra stock bought February 2016: Intel

Intel is another one of those American giants that have been, and interestingly enough, still are being treated poorly by the market. They are down at a P/E of 12 and they pay a 3.2% dividend which is fully acceptable. The market started to strongly dislike them for failing to take over the smartphone/iPhone. It is of course bad that they did not take over that and given time I hope their foot will open up that door more and more but what was in a way forgotten was all the server power that was needed when the internet usage exploded due to this kind of equipment. Intel happily provided the best processors for those servers.

So, yeah, they failed but could still profit from the development indirectly. The competitors of Intel are not doing very well today and many of them are having difficulties. Intel made 11 billion USD in profits last year. It was an acceptable year. As long as the core business of Intel will keep generating these kind of earnings they will be able to grind down new competitors. The day their core business is being challenged that day the true difficulties will start for Intel. AMD did a good job there for a while but today they are a shell of their former glory. Qualcomm is doing very well and is the next competitor for Intel to grind down. At least I hope so but one never knows for sure.

The previous time I bought Intel was back in 2013 when the P/E was even one step lower with 9.7 and a dividend payment of 4%. Now it was high time to buy some more again of this wonderful company!

I therefore bought 35 shares at a cost, including fees, of 973.55 €. This means that I now have 135 shares in Intel and my total investment is up at 2618 € which means a share price of 19.39 € including the fees.

To find out more regarding Intel then please click on analysis of Intel 2016.

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.

Analysis of Pfizer

Company: Pfizer

ISIN US7170811035 | WKN 852009

Business: An American biopharmaceutical company. It is difficult to talk about pillars that they are standing on because it is not but still they are focusing their efforts into six different fields: Immunology & Inflammation, CV & Metabolic Diseases, Oncology, Vaccines, Neuroscience & Pain and finally Rare Disease. In each field they are providing several different medications.

Active: Global but I found nothing more accurately. They do however claim to place major focus in the markets of the United States, China, Canada, Germany, Italy and Brazil.

P/E: 22.8

Analysed requests from 2014

This time we take a closer look at the requests that arrived in 2014 on the Analytical Requests page. The principle of how I looked at it was exactly the same as in the previous article Analysed requests from 2013 so there is no reason to go over that again.

From this year Graham has four green ones and only one red meaning that he had an 80% pick accuracy for the "extra ordinary" stocks in either direction. I on the other hand had only two green ones and one red so 67% accuracy but on the other hand I would not have picked a single company to invest in. That is always bad news.

Stock bought February 2016: IBM

IBM is one of those American giants that are today strongly disliked by the market. Each quarter the revenue is dropping, the earnings drop and yeah, the margins are not increasing still... I can buy this company today at a P/E of 9 with a dividend yield of 4% which correspond to 37% of their earnings. And well... Ginni Rometty are by some considered to be a bad manager but that is in my opinion wrong. She is excellent and as sharp as a titanium needle. Wall Street are crying about the IBM buyback program but for crying out loud. Should you run out and buy small IT companies at a P/E of >40 or simply convert (educate) your workforce into the new service business while buying back your own shares at a P/E of 9? I know that Wall Street wants things to be fast so they would for sure favour acquisitions like mad on one side and downsizing on the other. That is to me, to put it bluntly, stupidity in a nutshell.

No, no, she is doing everything correct. She allows the process to take the time it takes. The market hates them ok, then we increase the value for our shareholders by paying an excellent dividend + buying back shares. As a shareholder I do not complain that I am getting so much value (dividend + buyback) for each euro I put into this massive oil tanker.

For me IBM is an easy investment. It is an excellent company with an excellent management. IBM made 13.2 billion USD in earnings last year and that was not a great year for IBM. If a company are having those kind of cash flows during bad years then what will it look like in a good one?

I therefore decided to buy nine more shares in IBM and I paid in total (including fees) 1024.81 €. This means that I now have 25 shares in IBM and I have made a total investment of 3274 € which comes down to around 130.96 € per share including fees.

To find out more concerning IBM then please check out analysis of IBM 2016.

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.

Analysed requests from 2013

I decided to take a look at the requests that I have received over the years and how the development, in terms of share price, have been of those companies. First out will be the requests that I received during 2013 on the Analysis Requests page as it can be seen above. I have received many more requests over email and on twitter but I will stick to that what posted on that page.

This reflection is not only to take a look at the suggestions arriving but, maybe more importantly, I also look at and judge the buy or not buy comment based on Grahams formula as well as my own personal feeling concerning the specific company.

Should it stay or should it go?

This is an attempt of a survey to find out what you guys thoughts are concerning my current holdings. I start to have many of them and I have on numerous occasions already realised that I am not able to follow them all as well as I would have liked. By this I mean that I would love if all the companies would only arrive with annual reports for me to read and not a report each quarter but now that they do arrive with them then I should also read them. Sometimes months can pass before I realise that one of my companies arrived with a new quarter report. Good, bad? I cannot tell but I do not like that I am obviously not able to keep track of them all.

So the four questions are:

• Which three companies in my stock portfolio should I increase my holdings in?
• Which three companies should be kicked out from my stock portfolio?
• One company that should enter my stock portfolio?
• Why? and that goes for all the three above questions

I will not make a promise and say that I will run out and sell the companies, increase or add a new holding but I can promise you that I will keep it in mind for the future. Oh, and for February I have already decided what to buy so it will not influence the very near term decisions.

Hmmm... first I was thinking that I should start and give my own thoughts to it but that would be bad and could give an influence so I just leave it as it is.

Dividend from Deere: February 2016

My second dividend for the year has now dropped in to the broker account and even more interesting is that it is my first dividend payment from Deere. I stepped in as a shareholder a couple of days after the x date and for this reason I never got something during the autumn.

I have 30 shares in Deere and each paid out 0.60 USD. Those 18.00 USD that I got was converted into 16.52 €. From this I had to pay 2.48 € in taxes and as cash on my broker account I got 14.04 € that I can do as I please with. If everything remains as it is for the next couple of quarters then this gives me a YoC of around 3.1% which is fully acceptable however currency effects can be large.

To find out more about Deere then please visit analysis of Deere 2015 and the Stock Dividend page has now been updated if you want to follow my dividend progress.

Analysis of BP 2016

Company: British Petroleum 

ISIN GB0007980591 | WKN 850517 

Business: A British oil giant. They are divided into two business units which are: Upstream (extracting gas and oil) and Downstream (fuels, lubricants and petrochemicals). They currently have five brands: BP(oil and gas), Aral (gas stations where I buy all my petrol), Castrol (lubricants), ampm (convenience stores) and Wild Bean Café (cafés). 

Active: 80 countries world wide employing around 84,000 people (they still claim this on their homepage)

P/E: -14.2 (P/E5: 7.9)