I was hoping people could share their ideas of what they thought was good value going into 2010 and what they have sold.
Reasons for purchases and sales should be provided.
I'll kick it off first with my sales.
A couple of months ago I sold nearly all my financials e.g. AMP, ANZ, CBA, NAB etc.. I had been increasing my holding during the upswing and the with the increases in SP, they were over 1/2 of the portfolio and no longer seemed cheap given the low ROE and higher PE. I still think large profit increases are likely but I think the upside is probably limited compared with the potential downside if there is another black swan. I have been looking to buy back if there is a pull back and have been looking at qbe.
Purchases
Top ups of existing positions after profit upgrades
FGE- Came out with a huge increase in profit guidance, so forward PE was still <6 despite this already being a 11 bagger post its GFC low (I wish it was that for me)
CCV- Small profit upgrade but should be able to increase profits regularly by buying stores from its franchisees. Good ROE and div yield, PE of about 9 after you take away its 50m of cash.
AVX- A bit speculative this one, stopped its phase 3 HIV drug trial to analyse the results. I don't think any HIV drug that has reached a phase 3 trial has failed. Price has fallen back a bit as they did a cap raising. I thought they would be cashed up until the release of the results which is why I bought in. I participated in the cap raising and sold some after seeing how many shares were alloted to maintain a similair amount of shares.
Junior gold miners
BDG- Lots of bad history but has 50m cash, EV of 77m scheduled to produce 80,000+oz in 2010, low reserves but cashflow should be high at least in the short term if gold price stays at current prices.
DRA- Operates in Scandanavia, minimal debt, EV 70-75m also scheduled to produce 80,000+oz in 2010, so again cashflow should be high.
I'm also happy to hear criticism about my choices.
Reasons for purchases and sales should be provided.
I'll kick it off first with my sales.
A couple of months ago I sold nearly all my financials e.g. AMP, ANZ, CBA, NAB etc.. I had been increasing my holding during the upswing and the with the increases in SP, they were over 1/2 of the portfolio and no longer seemed cheap given the low ROE and higher PE. I still think large profit increases are likely but I think the upside is probably limited compared with the potential downside if there is another black swan. I have been looking to buy back if there is a pull back and have been looking at qbe.
Purchases
Top ups of existing positions after profit upgrades
FGE- Came out with a huge increase in profit guidance, so forward PE was still <6 despite this already being a 11 bagger post its GFC low (I wish it was that for me)
CCV- Small profit upgrade but should be able to increase profits regularly by buying stores from its franchisees. Good ROE and div yield, PE of about 9 after you take away its 50m of cash.
AVX- A bit speculative this one, stopped its phase 3 HIV drug trial to analyse the results. I don't think any HIV drug that has reached a phase 3 trial has failed. Price has fallen back a bit as they did a cap raising. I thought they would be cashed up until the release of the results which is why I bought in. I participated in the cap raising and sold some after seeing how many shares were alloted to maintain a similair amount of shares.
Junior gold miners
BDG- Lots of bad history but has 50m cash, EV of 77m scheduled to produce 80,000+oz in 2010, low reserves but cashflow should be high at least in the short term if gold price stays at current prices.
DRA- Operates in Scandanavia, minimal debt, EV 70-75m also scheduled to produce 80,000+oz in 2010, so again cashflow should be high.
I'm also happy to hear criticism about my choices.
