Thursday 16 March 2017

Fast Retailing annual report 2016

Front page of the annual 2016 Fast Retailing report

For the report in full please go here, to find out more concerning Fast Retailing then please visit analysis of Fast Retailing.

In the financial statement below we see that 2016 was not a great year for Fast Retailing. They had a very, very moderate revenue increase which is very bad and what makes it even worse is that the earnings are far from where they should be. The last time they were down at this level in earnings was in 2009. The sale area did also not improve with an impressive value and year to year sales, especially in Japan, is not something to brag about.

Financial statement for Fast Retailing 2016

Conclusion: Fast Retailing is currently having a tough time and Japan, their oh so important home market, are not delivering as one would have hoped. That should today be a cash cow that should support the expansion everywhere else in the world but instead stores needs to be closed down. I am not very happy with the development in Fast Retailing but I will remain as a shareholder for the time being because I do believe that they will have a bright future with their cloths and their store concept.

Wednesday 15 March 2017

Analysis of Tessenderlo 2017

Logo of Tessenderlo 2017

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: 15.1

To find out more concerning Tessenderlo then please go to analysis of Tessenderlo 2016.

Contrarian analysis of Tessenderlo 2017

The P/E of Tessenderlo is a little bit on the high side with 15.1 and the P/B is definitely too high with 2.5 which gives a no go from Graham. The earnings to sales are ok with 6% but one must admit that the ROE is pretty impressive with 16%. The book to debt ratio is also fully ok with 0.8.
The revenue growth rate is not very impressive for the last five years since it is at -5.7% which then gives us a motivated P/E of around 8 to 10 which means that Tessenderlo is today a bit overvalued on the market.
They pay no dividend at all which I do not like.

Conclusion: Tessenderlo would not be of interest to Graham as it is today with especially the P/B as it is because the P/E is ok. The ROE is also very nice but the fact that they do not pay a dividend is also disappointing. I will remain as a shareholder in Tessenderlo.

Tuesday 14 March 2017

Tessenderlo annual report 2016

Front page of the Tessenderlo 2016 annual report

For the report in full please click here and to see my previous summary then please visit Tessenderlo annual report 2016 and to find out more concerning Tessenderlo then please go to analysis of Tessenderlo 2016.

In the financial statement below we see that the revenue was pretty much flat but the restructuring and cost cutting seems to start to have an impact on the result. We therefore ended up with almost 20% more in earnings which is good, good news!

Financial statement for Tessenderlo 2016

Conclusion: Tessenderlo still have along way to go before they start to make some serious money again but the from my point of view that period is getting closer and closer. I will remain as a shareholder in Tessenderlo.

Monday 13 March 2017

Analysis of Nike 2017

Logo of Nike 2017

Company: Nike

Business: An American company that are selling and developing athletic footwear, apparel, equipment and accessories. They have several brands: Nike, Nike+, Hurley, Jordan Brand and Converse.

Active: They are present world wide and they are known world wide by name and symbol.

P/E: 25.2

For a previous very old report from 2013 please click on analysis of Nike.
Contrarian analysis of Nike 2017

The P/E of Nike is awful with 25.2 and the P/B is also horrible with 7.7 which gives a very clear no go from Graham!
The earnings to sales looks ok with 12% and the ROE is really good with almost 31% which is this case is not coming from debt leverage since the book to debt ratio is very good with 1.3.
The the last five year they have shown an excellent growth rate of 6.1% yearly which gives them a motivated P/E of around 20 which, however, still means that they are overvalued by the market today.
They pay a silly 1.1% dividend which only represents 27% of their earnings so there are room for further increases.

Conclusion: Nike is not a company for Graham as it looks today. The P/E and the P/B is too high and the dividend is too low. The only thing that is really good is the ROE. I will however remain as a shareholder.

Sunday 12 March 2017

Nike annual report 2016

Front page of the annual 2016 report from Nike

This is the first time that I report on the development of Nike. They are running a broken year so this 2016 annual report is already half a year old but as you know I do not invest from quarter to quarter so it does not really matter that much.

To view the report in full please go here and to find out more about Nike you can visit this very, very old report from 2013 called analysis of Nike.

In the financial statement below I see a development that I very much enjoy seeing in companies. Each year the revenue is increase by around 5 to 10% and better yet the earnings are increasing with ever so slightly more 10 to 20%. They are growing, increasing their sales and they are in full control of their costs while doing so. It is in a way sad to admit that one sees this more frequently with American companies than with European.

Financial statement of Nike 2016

Conclusion: Based on the figures Nike is doing very well and there is not much to bring up on the matter. The have a share buy back program of which they have used around 1.2 billion out of 12 billion and those 1.2 billion were bought back at an average share price of 58.44 USD (current share price 56.34 USD). I see no reason to leave Nike and I will therefore remain as a shareholder.

Saturday 11 March 2017

Analysis of Intel 2017

Company: Intel 

ISIN US4581401001 | WKN 855681 

Business: An American hardware producer (mainly processor). They have now increased their segments from five up to seven with an additional six sub-segments that I am sure all are of importance until the next report.

Active: Products are sold world wide. 

P/E: 17.0

To find out more concerning Intel then please go to analysis of Intel 2016.
Contrarian analysis of Intel 2017

The P/E of Intel is a bit of on the high side with 17.0 and also the P/b is a bit high with 2.7 which gives according to Graham a clear no go. The earnings to sales looks ok with 17% and the ROE also ok with 15.6%. The book to debt ratio is excellent with 1.4.
In the last five years they have had a disappointing yearly growth rate of only 2.2% which is... well... like inflation and this then gives us a motivated P/E of 9 to 13 which means that Intel is today a bit overvalued by the market.
They spend far too much money on R&D since it is up at over 120% of their earnings.
They pay an acceptable dividend in the size of 2.9% which represents 50% of their earnings so they should for many reasons start to improve those earnings!

Conclusion: Graham says no to Intel and so do I. The P/E, P/B are currently too high and the small dividend does not justify an investment. Since I am already a shareholder in Intel I see no reason to leave and will simply remain as a shareholder for now.

Friday 10 March 2017

Intel annual report 2016

Front page of the Intel annual report 2016

To view the report in full please click here and for my previous summary please see the Intel annual report 2015 and to find out more concerning Intel then please go to analysis of Intel 2016.

In the financial statement below we can see that the revenue increased very nicely but the cost of sales increased in a similar fashion which we do not appreciate. The bottom line is however very much black and with a net income of 10.3 billion USD which is good but they have, for at least the last five years, been bringing home 10 billion plus minus 1 billion and one would hope that value to grow at some point. In the same period they have grown from 53 billion to 59 billion in revenue so the margin is dropping slowly but surely. 

Financial statement for Intel 2016

Conclusion: Intel is still treading water and every now and then there are news of a coming apocalypse for Intel. When that day come I will look into it more closely. I will remain shareholder for now.

Thursday 9 March 2017

Analysis of IBM 2017

Logo of IBM 2017

Company: IBM

ISIN US4592001014 | WKN 851399

Business: An American IT service company. They are currently standing on six pillars and each year they are shifting things around and start reporting new areas. 

Active: World wide making sales in over 170 countries.

P/E: 13.1

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

Contrarian analysis of IBM 2017

The P/E of IBM is good with 13.1 but the P/B is awful with 9.5 which gives in total a very clear no go from Graham. Earnings to sales are great with 17% and the ROE is insane with 72% even though it starts to fall back in dramatic leaps. The book to debt ratio improved significantly and what used like a shaky bank is now... well... looking better let us put it like that.
In the last five years they have had a -5.2% yearly revenue growth rate which is very bad and this gives a motivated P/E of around 8 which means that IBM is today slightly over valued by the market.
They spend a healthy amount of money on R&D since it represents 40% of their earnings.
They pay an acceptable dividend of 3.1% which represents 41% of their earnings so it is all good in my book.

Conclusion: IBM is still not doing well but for me this actually looks like a turning point. Due to the latest increases in share price I must assume that the market have already realised this and started to buy shares. a timing that I will never be able to join in on. I will keep my shares for now.

Wednesday 8 March 2017

IBM annual report 2016

Front page of the annual 2016 report from IBM

For the report in full please go here, for the previous summary please see IBM annual report 2015 and to find out more regarding IBM then please click on analysis of IBM 2016.

Taken a look at the financial statement then we see the same trend continuous on and on and on with decreasing revenue stream and decreasing margin. At least the revenue seem to have started to flatten out and for 2016 IBM managed to bring in almost 80 billion USD while it was almost 82 billion USD the year before. The earnings have now dropped down to 11.9 billion USD which is bad considering that it was 13.4 in the previous year and 16.5 billion USD three years ago. Yeah... this oil tanker is not yet turned around.

Financial statement of annual 2016 report from IBM

Conclusion: IBM has very clearly a much longer way to go and there is not much to do about it besides from tucking in and trying to enjoy the ride until Watson rule the entire world! I will remain shareholder for now.

Tuesday 7 March 2017

Analysis of BP 2017

BP, a British oil giant

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)


Here you can find the previous analysis of BP 2016.

Contrarian analysis of BP 2017

The P/E of BP is silly due to the crazy low earnings and are therefore 970. The P/B is however very good with 1.2 however it starts to increase with a dramatic speed. This of course give a total value that Graham would not have liked. Earnings to sales and ROE is useless to speak of but the book to debt is at 0.6 which is only so, so. 
Due to many, many different reasons the revenue from BP have dropped like a stone which today means that in the last five years they have had a yearly revenue drop of -13% per year. This gives us a motivated P/E of 8.
They still pay a dividend of 7% which is insane. They should stop this to sort out their business because each year they are eating up their money for moving forward.

Conclusion: Graham says very clearly no to BP. Based on the figures it is, as it has for a long time now, not looking healthy. All the values are bad besides from P/B however that one is falling quickly. I will remain as a grumpy shareholder.

Monday 6 March 2017

BP annual report 2016

Front page of BP annual 2016 report

For the report in full please click here and to see the previous summary regarding BP annual report 2016 or why not take a look at the latest analysis of BP 2016. 

Is this finally the turning point for BP? Are all the fees paid for Deepwater Horizon? Will the oil price remain or even increase? Will there be problems in Russia and with Rosneft?

Looking into the financial statement below then we see that revenues are down by -18% which is indeed very bad. They have very large depreciation costs and they state that they will be larger for the coming year. The earnings are negligible in comparison what one would expect a company such as BP to make but they are down at 172 million USD which is... a very, very poor result. 

Financial statement of BP 2016

Conclusion: BP had another seriously bad year. I hope this was the turning year. The last time I had this thought the oil prices completely crashed so we shall see what happens this time. I will remain a grumpy shareholder.

Sunday 5 March 2017

Dividend from DBAG, ETF Russia, Intel & TJX: March 2017

Logo of DBAG 2017

My, unfortunately, only investment company DBAG decided to pay out a dividend to me. I received, for my 100 shares, a total of 120 €. From this was taken -31.65 € in taxes and I received 88.35 € as cash into my broker account.

To find out more about DBAG then please visit analysis of DBAG 2017.

Logo of HSBC 2017

My ETF Russia also paid out a dividend to me and I received for my 270 parts 62.30 € that was paid out directly as cash to my broker account.

Logo of Intel 2017

For my 135 shares in Intel I received a total of 33.22 € in dividend. From this was taken -4.99 in taxes and I ended up with 28.23 € as cash on my broker account.

For further information on Intel please visit analysis of Intel 2016.
Logo of TJX 2017
For my 32 shares in TJX I received a total of 7.89 € from which was taken 1.18 € in taxes and I received as cash on my broker account the amount of 6.71 €. Not much to celebrate but it drops in each quarter and more importantly their concept is good and their stores are very well visited.

For more information on TJX please visit analysis of TJX 2016.

To see my yearly dividend earnings then please visit the Stock Dividends page that will shortly be updated.

Friday 3 March 2017

Summary of February 2017

Summary February 2017

February was probably one of the most boring months at work. I suspect that routine starts to kick in also. I run to meetings without preparing things and just assume that I will be able to deal with whatever pops up. It seems to work. All my guys are working well and the amount of issues appearing within my groups is minimal... which means that things are then also a bit boring for me.

I no longer remember if I told you or not but I forgot to apply for new studies during this spring so I will also not be able to extract anything new from lecture book etc. hence... I have started to write more articles on the blog because I have time for it again but... at the moment I only catch up with annual reports and to make new analysis is still not on the agenda. Oh, and I managed to sign up for courses this summer semester and I will do some more BA and hopefully also some psychology. 

My lovely wife starts her first UK job today! I am very happy that she will now get the possibility to integrate herself in the UK society before we get deported.

Once per month I have to report to the executive management team (EMT) in my company about my progress. It has usually been a very interesting meeting between me and a couple of the EMT guys with healthy discussions of what needs to be done etc. In the last meeting a guy from over the pond join in to see what was going on over in UK in terms of developments...
Today all my already booked meetings were changed into skype meetings with different branches of our company joining in from all over the world. It confused me a little that so many people will now join in on those meetings that I went and asked my direct EMT boss what was going on? His answer was "you are a victim of your own success" - they enjoyed your meeting so much that now everyone wants to join in on them to find out what is going on in R&D. *sigh* 

This week I also found out that my business partner, that have been riding on my back since many years, did, as I suspected, not manage to keep running the company. We have therefore taken the decision to liquidate the company. I feel sad to see my baby be killed off like that but it is the only way to continue forward right now. Good news for my brother is that he will most likely receive some more dough from me according to the contract that we made when I borrowed money from him to start the company. The liquidation process does however take one year in Germany so he must wait for at least that period.

Oh, and it was a very busy month. I sold three shares and bought two that I already previously hold.

For the previous summary please visit Summary of January 2017 and here you can see my stock portfolio as it is.

Invested versus Current value February 2017

The total invested value is now up at: 87,577 € including a realised loss of -551 €. I bought BP and ETF Portugal.

Current investment February 2017

The value of the portfolio is today: 91,989 € and spread out I now have around 5,817 € in cash on the different accounts. The combined unrealised and realised loss is now at: 4,412 € (5%) which is not as good as one would have liked.

Me versus DAX during February 2017

DAX have been running like a mustard treated bull during February and is now up at 12,067 points which means an increase of  +4.5%! Woow! I am of course not as skilled as the CEOs of the 30 DAX companies and I therefore only have +1.9% for my portfolio.

Conclusion: DAX did excellently this month! I would even stretch out my neck and say that it did silly well. No matter I shall beat DAX in the long run... which by the look of it... must be much more than five years that I am now coming up to... the Index fund approach does indeed look tempting especially with a contrarian twist to it. Still, I am not that unhappy with my 11% in index funds that I have today.

Thursday 2 March 2017

Analysis of Avtovaz 2017

Logo of Avtovaz

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: -1.3

Here you can find the previous analysis of Avtovaz 2016.

Contrarian analysis of Avtovaz

The P/E of Avtovaz is negative, the P/B is negative so Graham would not have touched this one.   Earnings to sales are negative and the only good thing is the ROE which is up at 77% but they are also crazy leveraged so... yeah... means pretty much nothing at all. Book to debt ratio is negative.
They have had -0.6% negative growth rate in the last five years so well done on that one also. estimated P/E is well... probably bankrupt.
They do spend some money on R&D still... and of course they pay no dividends.

Conclusion: Graham and I say no to this one. I will try to stop this crazy experiments in the not too far away future.

Wednesday 1 March 2017

Avtovaz annual report 2016

Avtovaz, 2016, annual, front page

For the report in full please go here and to read my previous summary please click on Avtovaz annual report 2015 and to find out more regarding Avtovaz then please visit Analysis of Avtovaz 2016.

No, new news under the sun for Avtovaz. Interestingly enough the share price peaked at 1.4 € not that long ago but since I no longer check in on my stocks every day or week for that matter I simply missed the good opportunity to sell my shares without a too significant loss. Oh, well, occasions seems to come and go fairly frequently.

They did actually manage to push up their sales compared to 2015 which is very good news. Due to that they still have to import all the parts to get them in a sufficiently high quality their costs are unfortunately very high for putting the cars together and they are pushing market share like crazy. It is a true disgrace that such a natural resource rich country as Russia are not able to offer proper steel for their automotive industry. Bottom line Avtovaz made a loss of 44 billion RUB which should be compared to almost -74 billion RUB last year. What still makes me over the top excited is the equity that is at -58 billion RUB.

Financial statement for Avtovaz 2016

Conclusion: Avtovaz still have not managed to sort things out but it is impressive that they managed to increase their sales even further last year, a year, that was filled of uncertainty and crashed oil prices which made Mother Russia take a serious beating which always makes people spend less. I do like that the cost of sales have not gone of any further. I will remain a grumpy shareholder.