Tag Archives : stock selection


Share Price Charts Can Be Misleading – GSK And The Power Of Dividends

Most people look at the GSK stock price over the last 10 years and think it’s been dead money. The share chart will show that GSK shares were trading hands for £13.40 in 2007 and are trading for £14.80 in 2017. A lot of people have become disheartened by this abysmal share price performance. But it is important to note that great companies do go through extended periods of share price stagnation. And just because a company’s share price has stagnated does not mean wealth is not being created. GlaxoSmithKline is a classical example of this phenomenon. The persistent negative news-flow the company has faced over the past 10 years […]


Naspers and Tencent – A Great Arbitrage Opportunity 3

It is common knowledge that big companies don’t have fast growth. This has become so ingrained in investor minds that many growth investors do not go anywhere near big blue chip companies. But with most theoretical concepts, there is an anomaly to the rule. The anomaly in this case is a $400 billion company growing at 40% a year. The company is Chinese and goes by the name of Tencent. Now I know what you are thinking when you hear where this company is based. But I urge you to read on and understand why I rate Tencent so highly and consider it one of the best companies in the […]


August Monthly Stock Purchase – Imperial Brands, Shire

August has continued to see markets at record highs. Ever since the trump bump of November last year, many investors anticipated a correction – a 10% drop in market prices – to occur but there has been no sign of this yet. It appears as though the market keeps powering upwards regardless of valuation, regulatory and political risks. And this has got me nervous. It has become exceedingly hard to find investments that will produce double digit annualised returns. And it is for this reason the cash portion of my portfolio sits at 30%. It is important to note that cash is not held as a hedge. It is also […]


Dividend Reinvestment – A Way To Juice Investment Returns + Great candidates 1

Dividend Reinvestment is one of the most important concepts when it comes to investing. It is a way of owning more shares or units in a fund without putting your hand in your pocket for more cash beyond the original investment. It is a way of getting shares for free. To see how dividend re-investment works, take a look at the following. Say you own£10,000 worth of shares in Company A. This pays a 10% dividend each year, equal to £1,00 on your £10,000 investment. If you reinvest that £1000 in more Company A shares, you will have an investment worth £11,000. Fast forward one year and your 10% yield […]


Is Paypoint Worth a Punt? Great Financially But Does It Have A Future.

Whenever I run stock screens to try and find new shares worth investing in, Paypoint always seems to pop-up. The company has great Returns on Capital, strong Free-Cash Flows and a Bullet Proof balance Sheet. But the one thing that has always stopped me from investing in the company is the unknowns about its future i.e. the implications of its business model in a cashless world. Paypoint is retail payment processor that allows customers to pay utility bills, pay council house rents, buy lottery tickets, top up the credit on a mobile phone and send money to other people via its terminals which are found in local shops. The Financials […]


Paying Up For Quality Growth Stocks – What Makes A Great Business

Great businesses produce great returns. As Warren Buffet said “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” Rather than heading the great porches advice, most investors underestimate business quality which results in unduly low market valuations for the very best companies. As an individual investor, understanding quality and its true value can lead you to craft an investment strategy that exploits market inefficiencies. What Makes an Extraordinary Business So what makes a business extraordinary that deserves a premium rating? A truly great business can come in many guises but by and large there is a need for an […]


DMGT Stock Purchase – A Media Company With Hidden Technology Assets 1

Daily Mail Group Trust (DMGT) is best known for its ownership of its media assets, namely The Daily Mail, Mail on Sunday, Ireland on Sunday, Metro and the worlds number 1 online newspaper MailOnline. But from an investors point of view DMGT is known for its immense success. Since listing in 1932 it has never asked investors for an additional penny of capital – meaning the current market capitalisation of £2.2bn and the exemplary dividend growth record (8%pa compound over the last 20 years for instance) have been funded solely by the smart reinvestment of retained earnings and prudent use of debt. Looking at the historic performance of the shares […]


Shire Stock Purchase – The Importance Of Low Dividend Yield and Fast Growth In A Portfolio

Regular readers will know that I have been a big fan of Shire as of late. The company has fantastic growth, a pipeline that is envied by other biotech’s and a management team that is astute and rational. The best part about Shire is the valuation with shares trading hands at a P/E of less than 13. When a company looks attractive, I always ask myself ‘is there something I am missing? Is there something that I am not seeing that is making investors trade the stock at such a cheap valuation relative to its peers.’ With Shire, I think the answer is that investors are overlooking this stock due […]


May Stock Purchase – GSK, SHP and The Importance of Income 4

The month of May continued to see markets at record highs. For someone like me who is in the asset accumulation phase of their life cycle, this is terrible news. This is because I don’t like paying top price for ownership stakes in companies. I or anyone else for that matter who has a long time horizon in front of them should wish for languishing markets so that we get the most bang for our back – we get more shares for the same amount spent. Unfortunately the persistence of low interest rates by various central banks has meant stocks are at record highs and I need to pay up […]


Imperial Brands (IMB) Stock Purchase – Topping Up On an Existing Position By Exiting Dunedin Income Growth Trust

Imperial Brands (IMB) is a company I talked about glowingly a few months ago when I first purchased shares in it. It is easy to see why. The company has strong free cash flows, a recession resistant business model, a disciplined capital strategy and a history of double digit dividend increases which look like they are only going to continue. But for all this blue chip’s strength it is often overlooked by many an individual investor. This is because Imperial’s biggest money spinner is tobacco and people are averse to owning tobacco-related shares for obvious ethical reasons (I have written about ethics and investing before so have a look there […]