Robusta fundamental, leveraged investments

[Klogg]

I know there was talk of a breakdown of the assets attributable to each of the subsidiaries and ultimately to the shareholders of UOS, but management deemed it too complex from memory.

On talks of a property bubble - I honestly think this company would love a pop in property. Labour would be cheaper and they have mountains of cash to start land banking.

There's one risk that no-one really mentions though - the founder and CEO is in his early 70s, so he's getting on in years... and I'm yet to hear of a succession plan.

edit: I won't claim to have found this one on my own, someone asked me to have a look at the time.

Same for me - I found it as a result of the Eternal Growth fund also - started buying about 6 months ago.

 

[robusta]

Thank you for that Klogg, hopefully regarding the succession plans it will follow the pattern on the first generation founds the business, the second grows it while the third looses it.

Thank you for the reference to Eternal Growth partners they look really interesting. It would be good to have a look inside his portfolio. The returns are impressive.

I might copy a few of the above posts to the UOS thread so they are not so hidden on this ramble.

 

[KnowThePast]

I believe this is the article.

http://www.eternalgrowthpartners.com/node/168

All credit to eternalgrowth who posts a lot on this company over at Hotcopper.

That's the one!

Thanks for correcting my laziness, Ves.

 

[burglar]

Forge in administration!?

 

[robusta]

Forge in administration!?

Yep luckily I got out of it a while back, should never have been in FGE in the first place.

 

[burglar]

Yep luckily I got out of it a while back, should never have been in FGE in the first place.

In my own funny way I was trying to say this:

Sorry, I was wrong!

When you nipped out of Forge, I posted about running your winners.

Hindsight is a wonderful thing.

 

[robusta]

Sorry mate missed your post, you did hit a nerve about running my winners, I have sold way too many businesses early and have more often than not regretted the sell decision.

With the 20/20 vision of hindsight, I was lucky to get out of FGE for a profit but stupid for being invested in the first place.

Now if only I can get my hands on a copy of The Australian Financial Review from say sometime in the year 2019

 

[burglar]

... Now if only I can get my hands on a copy of The Australian Financial Review from say sometime in the year 2019

Well said!

 

[robusta]

This may be a bit boring to some and I'm positive there are more than a few contributors on this forum giving a yawn and saying yeah yeah, I hold a few of those and some even better bit today notched up my first triple bagger

IPP - Iproperty Group

So bought in two parcels;

1660 xIPP @ $0.915 = $1538.85 14/11/12

1910 x IPP @ $0.785 = $1519.30 22/04/13

$3058.15 total invested including brokerage. At today's closing price of $2.76 the market is pricing my 3570 shares at $9853.20 a gain of 222.2%
Richie Beanaud would be proud. http://www.youtube.com/watch?v=8CSiPHFOQSU

This is a better looking chart than the ones I draw, hope you don't mind piggybank

The company released their 2013 result today. It iProperty Group was profitable in 2013 as well as strong revenue growth and positive operating cash flow in Q4. The presentation can be viewed by clicking on the link below - enjoy.

http://stocknessmonster.com/news-item?S=IPP&E=ASX&N=782774

View attachment 56861​

 

[craft]

today notched up my first triple bagger
IPP - Iproperty Group

Well Done Robusta

If I had to rate my trading decisions I would have to say performance has been below average to average at best. The strategy of buying the best businesses you can find at a reasonable price however will in my opinion outperform given enough time.

I would say an A for temperament. And that's the most important element.

 

[burglar]

Didn't know what to make of this thread, but had some spare time on my hands.

It was an easy read.

All the while I expected the detractors and naysayers to appear.
I guess you have parried them somehow!?

Just an observation if I may.

If any of your picks was to treble you would be looking good, would you not?

My post from two years ago!!

 

[robusta]

Well Done Robusta

Thank you that means a lot coming from you. I can't count how many times I have read one of your posts and thought, that says every thing I want to say plus a whole lot more I had never thought of and a whole lot more eloquently.

Looking at the Present Value of Future Cash Flow, Long Term Investments, NVT, TGS, TRX, MTU, SMSF Returns and many other threads there are a lot of those moments when I've thought wow there is nothing I can add to that.

Thanks again.
Hope that wasn't too much but had to say it sooner or later.

 

[robusta]

My post from two years ago!!

You are bloody Nostradamus!!!

Not sure how good I'm looking. Remember these are all paper profits at the moment, I won't count my chickens until a nice passive income is flowing in or large capital gains are taken. Hopefully both will happen in the future.

 

[slooi1]

You are bloody Nostradamus!!!

Not sure how good I'm looking. Remember these are all paper profits at the moment, I won't count my chickens until a nice passive income is flowing in or large capital gains are taken. Hopefully both will happen in the future.

Robusta,
Good going on the triple bagger! Now, to resist selling just because it's gone up by a lot...
Hope the profit season is good for you so far.

slooi1

 

[craft]

Hope that wasn't too much but had to say it sooner or later.

Yep too much But thanks.

Its really the reader and not the writer that can take credit for what is taken on-board.

Most of my posts are really for my benefit as writing something's down seems to help me. If you got anything from reading them all credit to you.

ps.

I've got lots from reading your posts too, you often set the thought train a running for me.

 

[robusta]

Yep too much But thanks.

Gotta admit like most Aussies I'm not to keen on flowery compliments either. Anyway on to business.

On the day of the downgrade about a month ago I did this.

New Investment

TRS - The Reject Shop

Bought 175 @ $11.50 = $2032.45

Here I go again, buy now think later.

TRS has been on my watch list for a long time. Have been on holidays, came in off the kayak and discovered the sp had plunged, so picked up a small parcel. Will have to see if there is any growth left in TRS.

Investment Sold

175 x TRS @ $10.5155 = $1820.27

A capital loss of $212.18

Nothing much has changed since the purchase date, the h/y report was about what I expected and it would not surprise to see this business growing well into the future. The bottom line is I'm was fully invested and reckon there will be better opportunities out there. TRS just seemed like the weakest link in the portfolio.

 

[robusta]

Investment Increased

A couple of weeks ago established this position.

New Investment

UOS - United Overseas Australia

Bought 2634 @ $0.535 = $1429.14 13/2/14

This is a REIT invested mainly in Malaysia, they have a good history of capital management, low debt and a nice little discount to NTA.

Today after a bit more research aided by a helpful link from some ASF members I felt confident enough to make this business a larger percentage of the portfolio.

Bought 3460 x UOS @ $0.52 = $1819.15 26/2/14

Will sign up for the DRP for a while as well.

 

[robusta]

A couple of weeks ago I bought some IAA

New Investment

IAA - Ishares Asia 50 ETF

Bought 41 @ $49.00 = $2028.95 4/2/2013

http://au.ishares.com/fund/fund-overview-IAA-ASX.do

I know it is all bad news at the moment regarding currencies and growth but the region is still growing fast and long term I expect the Asian currencies to appreciate while A$ should depreciate. The two largest holdings Samsung and Taiwan Semiconductors are also attractive IMO. Like the other ETF in the fund (WDIV) I will participate in the DRP.

Well yesterday,

Investment Sold

41 x IAA @ $51.03 = $2072.28 or a capital gain of not much.

The main reason for selling is once again I found myself fully invested and I'm pretty sure can do better in individual stocks rather than this ETF.

 

[robusta]

Portfoilo Update

Reporting season is over and there has been a fair bit of trading around the edges so time for a update, but first a look at the larger picture.

The portfolio started on the 20th of July 2011 with a $30,000 line of credit and no cash, $40.00 a week was initially deposited building up to the current $75.00 a week that is currently being transferred. It still surprises that in such a short time this now adds up to $7425.00. The debt on the line of credit is now $27,743.93 and at the close of trading today the portfolio has a market value of $52,047.99 so if liquidated right now with no brokerage there would be $24.304.06 of equity.

Yes a rising tide does lift all boats and a nice improvement on the -$6000.00 equity of not too long ago. Now for a look at the investments.

EZL - Euroz Securities.

Bought, 1412x EZL @ $1.055 = $1509.61 on 17/07/12, now trading at $1.255 ($1722.06) a gain of 17.39% This is the smallest position at 3.4% of the portfolio. Revenue was up 13.77% while NPAT was up 22.9% the management and majority shareholders running this business know a whole lot more about the resource and energy sectors than I ever will and they have a good history of share holder friendly capital allocation.

HHL - Hunter Hall International

Bought; 1182 xHHL @ $2.85 = $3388.65 on 23/11/12, 717 xHHL @ $2.83 = $2049.06 on 11/03/13, and 638 xHHL @ $2.35 = $1519.25 on 30/05/13 for a grand total of 2357 shares for $6956.96, now with a market value of $7508.25 a loss of -17.95%
This position that is currently 10.97% of the portfolio has the distinction of being the largest percentage looser and also having the most capital allocated to it. FUM, net profit and dividends all fell. There is hope with no debt and a investment strategy and portfolio that I'm sure will outperform in the long term as they have in the past.

IMF - Bantham IMF limited

Bought; Bought 819 IMF @ $1.83 = 1518.72 on 3/10/2013, Bought 877 @ $1.71 = $1519.62 16/12/13 and Bought 870 @ $1.72 = $1516.35 on 05/02/2014 for a grand total of 2566 shares for $4554.69 now with a market value of $4464.84 a loss of 1.97%
This recent investment is currently 8.58% of the portfolio. The most recent results looked good with revenue up 44% and profit up even more for what it's worth. The earnings will always be lumpy but if they grow and diversify internationally profits should even out in the medium to long term. At around current prices the DRP seems to me to be an attractive option.

IPP - Iproperty Group

Bought; 1660 x IPP @ $0.915 = $1538.85 on 14/11/12 and 1910 x IPP @ $0.785 = $1519.30 on 22/04/13 for a total of 3570 shares for $3058.15 now with a market value of $10995.60 a gain of 259.55%
At 21.13% of the portfolio this is by far the largest position and was by far the most difficult buy decision. Every other investment earns a profit and pays a dividend IPP has only had one cash flow positive quarter. The reason this is in the portfolio is because of the revenue growth and the chance they will build a competitive advantage like REA, the market seems to be thinking this is a possibility.

MTU - M2 Group

Bought, 649 x MTU @ $2.62 = $1711.99 08/08/11, now with a market value of $3918.75 a gain of 136.06%

This investment at 7.53% of the portfolio was a bit over twice as large about six months ago but profits were taken at around current prices, a decision I'm starting to regret. Back then the doubt was whether they could transition from growing by acquisitions to a more organic growth model. NPAT up 26% while earnings per share and dividends were also up enough to prove me wrong.

NVT - Navitas Limited

Bought; 1023 x NVT @ $2.93 = $3017.34 on 02/02/12 and Bought 266 @ $5.63 = $1517.53 on 30/10/13, now with a market value of $9744.84 a gain of 114.89%

The second largest position at 18.72% of the portfolio this is a excellent business. The recent headline results (revenue up 19%, NPAT up 3%) don't tell the full story. NVT is a cash generating machine with a excellent market leading business in a growing market. Makes me fell a little slow that I waited over a year and a half before increasing the investment in this one.

SRX - Sirtex Medical Limited

Bought, 150 x SRX @ $9.74 = $1480.95 on 24/04/13, now with a market value of $2422.50 a gain of 63.58%

This small investment is now 4.65% of the portfolio, a long history of growth is about to reach a crossroads with results of major clinical trials due for release early next year. The expected results should be either a large multi-bagger or a small loss in the future.

TGA - Thorn Group

Bought, 972 x TGA @ $1.505 =$1482.81 on 05/04/12, 1074 x TGA @$1.395 =$1518.18 on 26/04/12, 867 x TGA @ $1.745 = $1532.87 on 20/11/12 and Bought 762 @ $1.97 = $1521.09 on 07/02/14 for a grand total of 3675 shares for $6054.95, now with a market value of 7570.50 a gain of 25.03%

At 14.55% of the portfolio I consider this another core holding and will probably consider adding to the position on any further dips in price. The most recent results were solid but the thing to keep an eye on are the investments being made in future growth areas meanwhile Radio Rentals just keeps on spinning off cash.

UOS - United Overseas Australia

Bought; Bought 2634 @ $0.535 = $1429.14 on 13/2/14 and 3460 x UOS @ $0.52 = $1819.15 on 26/2/14, currently trading at 3387.17 a gain of 4.12%

This most recent investment is 6.5% of the portfolio, at a nice discount to NTA and shareholder friendly management I will participate in the DRP.

WDIV- SPDR S&P Global Dividend Fund

Bought, Bought 128 x WDIV @ $15.83 = $2046.19 on 07/01/14, now valued at $2068.48 a gain of 1.09%

This second smallest position (3.97% of the portfolio) is still under review. This ETF in my opinion holds a basket of undervalued securities, the question is how much growth can they deliver?

 

[Ves]

Hi Robusta, looks like you have learnt a lot by holding some of these businesses and generally from being an active participant in the market (investing / trading with real money) rather than a passive observer (ie. just reading books and watching).

I have enjoyed watching your journey unfold. Despite a lot of earlier criticism and doubt about your method, it seems to have turned out quite well!