Happy New Year! – A (Baker’s) Dozen for 2012

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Argo Group, Asta Funding, Avangardco, Colony Financial, Cresud, Dhir India, EIIB, FBD Holdings, Livermore Investments, pdosullivan, Petroneft Resources, Sirius Real Estate, Total Produce, Trinity Biotech, Vietnam Opportunity Fund

Philip O’Sullivan kicked us all off here with his list of picks for 2012, and so far I’ve seen John Kingham and Mark Carter join in with their contributions here. Note John can only win half of the (non-existent!) prize since he came up with 2 lists…

I struggled with the idea a little myself – I’d far prefer to write 1,200 words about 1 stock than to write 1 list, haha! I also dread seeing shoot-for-the-moon lists (congrats so far, chaps) stuffed full of triple leverage ETFs and penny dreadfuls – not much use to any of us in the real world.

2011 Stock Recommendations & Performance

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Argo Group, Asta Funding, Colony Financial, Cresud, Dhir India, EIIB, Fair Value, portfolio performance, purchasing power, Sirius Real Estate, Total Produce, Trinity Biotech

I’m sure you’ve noticed I’m not shy about setting Fair Value Price Targets for recommended stocks. I don’t see a lot of people out there doing this – pretty obvious why…I’m sure someone will be sure to point out how precisely wrong I’ve been when I come up with a few duds! Ouch!

But, in an ideal world, the best way I’d evaluate any recommendation from a website or blog is to know the writer’s price target and portfolio stake. Ownership demonstrates their conviction, the size of their stake confirms the strength of this conviction, and their price target allows the reader to perform their own risk/reward evaluation. What are your own thoughts? Do you agree whole-heartedly, partially, or do you think this approach is a danger or a hindrance in some way?

Top 10 Most Popular Posts in 2011

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Argo Group, Black Earth Farming, Dhir India, ECDC, EIIB, farmland, Greencore, Total Produce

Here we are, beginning with the most popular post:

Duh, Duh, Dhir…

Total Produce (TOT:ID) – A Fruity Delight?

Argo – Time to Claim the Golden Fleece

Top 5 Least Popular Posts in 2011

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ADVFN, EIIB, Hot Tuna, Trinity Biotech, Xmas List

OK, let’s start with Least Popular Posts and then we can move to something better! Here we go, beginning with the least popular post:

A Merry Xmas & A Prosperous New Year!

–          Bah, humbug!?! Who doesn’t like Xmas?!

Total Produce – Eat More Fruit!

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Capespan, Net Interest/EBITA, Price/Sales, Total Produce, value investing

Total Produce (TOT:ID)

• Mkt Price:  EUR 0.38
• Mkt Cap:  EUR 125.4 mio
• Net Int/EBITA%:  8.7%
• P/E:  5.3
• P/S:  0.05
• Yield:  4.7%      

With two recent deal announcements, I decided to take another look at my TOT valuation, following on from here and here.

A Merry Xmas & A Prosperous New Year!

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fear and greed, home bias investing, Merry Xmas, value investing

A Merry Xmas to you, dear reader! It’s been a bit of a bumpy year – so remember to take some time out this Xmas to relax and enjoy the season with family and friends.

Yes, looks like it’s been one of those years where the blithe buy-and-hold 100% home market ‘investor’ beats most of us hard working egghead investor types..! I’m thinking specifically of the S&P 500 (and the US dollar, of course), which is up v marginally for the year, vs. most other (down) markets ‘round the world. Not trying to pick on US investors, but the average US Joe Public investor  usually suffers from a pretty bad case of home bias. (And no, I don’t blame the average US investor. It’s ludicrous to see most US financial journalists, advisers etc. recommend an ‘adventurous’ 20-30% allocation to foreign markets/currencies when the US share of global GDP is limited to 25%!).

Asta Funding – Buying Debt for Cents on the Dollar

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Asset Acceptance Capital, Asta Funding, distressed assets, Encore Capital, Ex-Cash Ratios, Margin of Safety, Owner-Operator, Portfolio Recovery Associates, value investing

Asta Funding, Inc. (ASFI:US)

• Mkt Price:  $7.65
• Mkt Cap:  $112.0 mio
• P/E:  10.8
• P/C:  1.02
• P/B:   0.65   

Asta Funding’s a NJ based company which purchases, services and collects on charged-off, semi-performing and performing consumer receivables. This strategy offers attractive growth prospects, driven by increasing levels of consumer debt, defaults and use of third party collection agencies. As they say: ‘Never count out the American consumer’. Of course, one can also count on the US consumer to rack up and default on ever increasing amounts of debt! I was shocked to see, especially in the current environment, that Black Friday was the largest ever. But then again, the US savings rate is collapsing again, after a brief recession-induced spike to 8% in 2008. Longer term, this puny savings rate doesn’t bode well for the US. Globally, most countries have a savings rate that’s a multiple of the US rate…

Xmas List (III)

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C.J. Sansom, Colm Toibin, Henning Mankell, John Banville, Justin Cronin, Kate Atkinson, Robert Wilson, Tana French, The Passage, Twilight Moms

No, I haven’t forgotten about writing up stocks..! Have an (interesting) few I was just about to buy and write about…but haven’t pulled the trigger yet…hey, what are you buying in this bloody market, either?!

Time for some lighter entertainment instead:

Fiction:

‘Dark Fire’ – C.J. Sansom:   I don’t know why I haven’t got any further with this series yet..! I actually have ‘Sovereign’ (the third in the series) already, so have had to put it aside until I can read ‘Dark Fire’. These books are ultimately crime dramas, but set in an accurate and wonderfully atmospheric depiction of life in Tudor England. For a little variety, Sansom’s also written a wonderful Spanish Civil War thriller, ‘Winter in Madrid’, which I highly recommend. I am reminded of Robert Wilson’s excellent novels set in Lisbon, ‘The Company of Strangers’ and ‘A Small Death in Lisbon’.

Xmas List (II)

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A.W. Jones, Charles Kindleberger, Margin of Safety, Matt Cooper, Peter Cundill, Peter Gyllenhammar, Reinhart & Rogoff, Seth Klarman

Finance:                   

‘There’s Always Something to Do’ – Christopher Risso-Gill:   I was always a big admirer of Peter Cundill, and was saddened to see he passed away at the beginning of the year. If I recall, Cundill was perhaps my first memorable introduction to the exotic world of international value investing, and I look forward to some useful tips and insight from a master in this book.

‘Free Capital’ – Guy Thomas:   I haven’t actually come across a copy of this yet. Yes, I’m a big supporter of bookshops…so I can suss out what books I actually want to buy on Amazon! Only kidding, I do try to buy in bookstores as much as possible. At least, they’re a lot more enjoyable and comfortable places to be these days. I’m bemused to recall my local bookstore years ago: As far as I could tell, the shop assistants (yes, they were called that then) had only 2 functions: a) to stare at you in contempt when you tried to buy a book, or even worse inquire about one, and b) to sneak up behind you, and yell ‘No reading the books!’ over your shoulder… How quaint!

The Worm in the Greencore (II)

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distressed, Greencore, IFG Group, Interest Coverage, Margin of Safety, Operating FCF, Pension Deficit, Rights Issue, Uniq

Greencore Group plc (GNC:ID or GNC:LN)

• Mkt Price:  EUR 0.635
• Mkt Cap:  EUR 244.2 mio
• P/E:  3.9   (well, sorta…based on 2011 Cont Adj EPS)
• P/S:  0.19
• Div Yield:  8.5%      

Continued from here… Before we look at Uniq, there’s two other acquisitions to tackle: First is the abortive (recommended) merger with Northern Foods. I was shocked when this was announced in Nov-2010. What the hell were they doing? Despite the management guff, clearly they already had enough on their plate. At least it was a nil premium merger, and promised GBP 40 mio of annual savings within 3 years. On that basis, things might not necessarily get any worse after the merger, and just might get better..! The market certainly shared this conclusion, with GNC’s share price actually rallying sharply.