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Micawber
Posted: 09 August 2016 10:35:40(UTC)
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New thread. I am currently struggling to identify shares or ITs that I consider any kind of bargain at current prices. Nearly all of my holdings now are close to their highs for the year, the ones that aren't are ones where after topping up I already have a substantial holding that I don't want to increase, and my recent purchases have for the moment absorbed the few ideas I had (including Blue Prism, Green Reit, P2P Global, and ROBO.

So this thread solicits suggestions for investments that look cheap, closer to year lows than highs, have some track record to analyse and preferably pay a respectable dividend.

I am not looking for potential gold mines in Anglesey or Senegal or the latest new material out of some university's chemistry department. Just for shares, ITs or ETFs tradeable on the LSE with a good investment case and currently at a good price.....
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Jeff Liddiard on 09/08/2016(UTC), c brown on 09/08/2016(UTC), James Skelton on 09/08/2016(UTC), Guest on 14/08/2016(UTC), mc2 on 11/02/2017(UTC), Guest on 04/03/2017(UTC)
srg751
Posted: 09 August 2016 11:13:02(UTC)
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I'm looking for an industrial stock to fit in my PF. The company that is now on my to buy list is Victrex. It fits most of your criteria.
It's bounced off a bottom twice so it should have limited down side. IC brought it to my attention a couple of weeks ago.
Here's Hugh Yarrows take on it ;


Victrex
10 portfolios across the IA UK All Companies and IA UK Smaller Companies sectors have large relative stakes in the business.
Victrex, the FTSE 250-listed chemical and industrial group, currently has a dividend yield of 3.9 per cent and has grown its dividend (which is well-covered) by 13 per cent over the past five years on average.
Though its share price is down more than 17 per cent so far this year due to pre-tax profits falls, Yarrow and Peters believe Victrex to be a high quality company that can grow shareholders capital and income over time
 
“Lancashire-based Victrex is a global leader in high performance polymers, materials that have several advantages over metal in applications such as planes, cars and medical implants.”
“Its products help customers save money, reduce production time and improve the performance and efficiency of their products. Victrex generates strong cash flow and has no debt, and has a clear policy to pay special dividends when cash builds up above a certain level on the balance sheet.”


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Micawber on 11/08/2016(UTC), normski 2nd on 02/03/2017(UTC), Guest on 04/03/2017(UTC)
Micawber
Posted: 09 August 2016 11:53:46(UTC)
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Thanks for that srg751. Victrex is on my watchlist but I hadn't checked out its sp relative to year's hi/los It looks a starter. Better than Synthomer.


I have a few other industrials on the watchlist that ought to benefit from the decline in sterling (which is likely to continue, I think). But they are nearly all at or near year highs.
DavidR
Posted: 09 August 2016 13:09:16(UTC)
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One of the sources I use for ideas is the portfolio at maverickmoneyuk.com. Although there's no performance data it looks well diversified (perhaps there are too many holdings?!).

3 year price and discount charts for popular ITs also give a quick feel for trading ranges and relative value.

The latest purchase was Bluefield Solar Income Fund which is not far from its low ...
CUEBALL
Posted: 09 August 2016 17:56:30(UTC)
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As I mentioned last week PLP(amongst all the others!) ...still an absolute bargain despite the gains since..

Nice to see panic on the upside for a change ..been awhile ....Never underestimate Vera
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srg751 on 09/08/2016(UTC), Micawber on 09/08/2016(UTC)
Micawber
Posted: 09 August 2016 19:53:26(UTC)
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PLP (polypipe) now watchlisted after an initial gander. I'll read up on it tomorrow.
James Skelton
Posted: 09 August 2016 20:28:59(UTC)
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Moss Bros (MOSB)

Seems a solid company. Looking to consolidate UK assets and expand online presence - fairly successful so far. Share price had been steadily working northwards over the last year in line with good results, but took a tumble towards the end of June (Brexit concerns I guess). Currently trading at ~90p (52 week low ~87p, high ~110p). Dividend almost 6%.

I've been holding for a while looking for growth and income. Contemplating topping up.
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Micawber on 11/08/2016(UTC), Guest on 04/03/2017(UTC)
srg751
Posted: 09 August 2016 20:36:39(UTC)
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PLP..... Both EPS and pretax profits forecast year on year rise of 25% (ish).
2 years old company with 75% debt which I suppose is about right for a new co. Micawber wont like it though !!

Cueball....... I still like 'your' Vesuvius... Fits my 'new' style..... Just. .... But a sterile economy doesn't need that much molten metal..... It's second on my watch list. .... Yes... I'm dithering.

I suppose you read my post a couple of weeks ago?... I bought Vesuvius, or so I thought,....Then entered it onto my spread sheet and left it at that. ..2 weeks later I went into my account to find......NO Vesuvius..... God knows what happened.....17% I missed out on.... What a mug !!!



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john_r on 29/01/2017(UTC)
Micawber
Posted: 09 August 2016 21:01:26(UTC)
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srg 751/PLP: You're right that I have a question mark over the borrowings. Also the net assets which rely heavily on 'intangibles'. That somewhat erodes the first sight attractions of a price to book of around 2. More reading required going into the business.
Jasper Plankbadger
Posted: 09 August 2016 21:43:57(UTC)
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A number of the house builders are very cheap at the moment, probably
another 15-20% bounce in them within the next couple of months.
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Guest on 16/08/2016(UTC)
Jon Snow
Posted: 09 August 2016 21:44:13(UTC)
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Have you considered Melrose (MRO), they have a buy/improve/sell strategy and a pretty good track record.

They are currently raising cash via a rights issue to buy Nortek Group.

Returns tend to be capital gains via new share issue/cancellation rather than dividends.

My mums done rather well out of them, although she doesn't know it and she's about to take up the rights issue too.

Website - http://www.melroseplc.net/
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Micawber on 11/08/2016(UTC), Guest on 04/03/2017(UTC), Andrew Smith 259 on 18/06/2017(UTC)
Micawber
Posted: 10 August 2016 09:03:08(UTC)
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In the news page I drew attention to the opportunity in HOT a week or two ago. I doubled our holdings on 11 July and it has risen 14% since then. The rise is almost all down to increase in NAV, for the discount remains around -17.65% against a year average of around -12%. The z-score is -0.83 which has come in a bit, though still in buyabe territory.

I will get some more for my youngest, I think.
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c brown on 10/08/2016(UTC), dlp6666 on 11/08/2016(UTC), Guest on 04/03/2017(UTC)
King Lodos
Posted: 10 August 2016 10:39:33(UTC)
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Russia and Brazil have performed very strongly this year, yet are still almost 5x cheaper than developed world stocks

So I'd ignore year highs ... When a cheap market mean reverts, it can spend consecutive years (/decades) marking new highs – and in fact the year high, in the first year, is a buy signal (12m relative strength)

If you look at Magic Formula stocks, adding a filter to only buy on 12m highs is one of the best ways to improve performance (not quite as good as 6m RS)

There it is, in fact:

mfi

But anyway, Apple could fit the bill ... Low valuations, only level for the year, but on good momentum now ... Warren Buffett bought Apple earlier in the year (for the first time) ... Just depends whether it can find another killer app to spur enthusiasm, but it's cheap
Reorganising my Portfolio
Posted: 10 August 2016 10:52:33(UTC)
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GB Group.
Expected to reach £4
Good recent results.
Large new contracts government linked.
Possible take over target.?
I have been in since early so hopefully if all goes well
I can retire again.😀
SDRL
Posted: 10 August 2016 13:22:49(UTC)
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I think the DBS Bank in Singapore is a good deal now. They are trading at a discount because an oil service company they made a loan to went bankrupt so that brought their share price down. But it is a very well run bank and pays an over 4% dividend.
Micawber
Posted: 10 August 2016 13:39:05(UTC)
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Keep 'em coming.

GBG looks interesting but is close to year highs and pretty fully valued. However that might be justified, along with the stonking high P/E and a price to (mostly intangible) book of around 8...... Watchlisted, and also added to my new AIM virtual portfolio where it qualifies. I will chew on it.



Melrose is really difficult to value. Relies on management track record in turnarounds, which is impressive. To save me looking really hard, have they had prior experience of doing it in the USA, Jon?

.....

Apple: "traded on the LSE" was one of the criteria. US shares, especially the giant ones, are so well researched that it can't be said to be cheap or dear except with later hindsight.
Raj K
Posted: 10 August 2016 14:11:30(UTC)
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Micawber;36195 wrote:
In the news page I drew attention to the opportunity in HOT a week or two ago. I doubled our holdings on 11 July and it has risen 14% since then. The rise is almost all down to increase in NAV, for the discount remains around -17.65% against a year average of around -12%. The z-score is -0.83 which has come in a bit, though still in buyabe territory.

I will get some more for my youngest, I think.


I had a quick look at HOT. I tend to stay away from IT's that have over 50/60 Holdings. Funny on HL it classifies it as a IT with a concentrated portfolio which is not what 90+ holdings seems to me. Is the play on HOT based on the fact it has a big discount and looking to narrow or is it a quality IT with a quality manager?


King Lodos
Posted: 10 August 2016 14:43:09(UTC)
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Micawber;36206 wrote:
GBG looks interesting but is close to year highs


I'll say it one more time here then butt out ..

"Year high" doesn't tell you anything about whether a stock's cheap or not ... It's a total layman's concept that's fairly contraindicated by data

And remember P/E ratios aren't always much use in tech stocks ... Amazon or Google would've been screaming buys on P/Es of 100x and 60x ... In reference to both: “People concentrate too much on the P, but the E really makes the difference” – Peter Lynch
Micawber
Posted: 10 August 2016 14:57:58(UTC)
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Raj K;36207 wrote:
Is the play on HOT based on the fact it has a big discount and looking to narrow or is it a quality IT with a quality manager?




Both.
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Raj K on 11/08/2016(UTC), dlp6666 on 11/08/2016(UTC)
Micawber
Posted: 10 August 2016 15:03:38(UTC)
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King Lodos;36208 wrote:
Micawber;36206 wrote:
GBG looks interesting but is close to year highs


I'll say it one more time here then butt out ..

"Year high" doesn't tell you anything about whether a stock's cheap or not ... It's a total layman's concept that's fairly contraindicated by data

And remember P/E ratios aren't always much use in tech stocks ... Amazon or Google would've been screaming buys on P/Es of 100x and 60x ... In reference to both: “People concentrate too much on the P, but the E really makes the difference” – Peter Lynch


You stick to your mystical charts and tealeaves, and as a layman whose youthful employment with a City stockbroker is now way out of date I'll continue to weigh up P/Es, PEGs, price to book, and several other things including macro, sectoral considerations (within which P/E remains one of a number of useful points of comparison), moving averages, rsi, the nature of a business, and what Tony describes as the peculiar oscillation in share price that seems to take place over a year, particularly for larger stocks, and which can present him, and me, with opportunities for a timely buy..
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Mickey on 18/10/2016(UTC), Guest on 04/03/2017(UTC)
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