TGISVP – Hot? Not?!

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Alpha Portfolio, Barron's, Beta Portfolio, binary outcomes, Fastnet Oil & Gas, FBD Holdings, garbage stocks, intrinsic value, junior resource stocks, Leverage, Margin of Safety, Petroneft Resources, portfolio allocation, portfolio performance, risk management, Smart Alpha Portfolio, Smart Beta Portfolio, stock screener, TGISVP, Total Produce, Trinity Biotech, US Oil & Gas, value investing

In my last post, I was delighted to see the TGISVP Alpha & Beta Portfolios continue to expand their level of out-performance vs. their ISEQ benchmark. Particularly pleasing was the sight of my favourite, the Smart Alpha portfolio, far outpacing the others with a 21.1% YTD absolute return. But we’re still only 9 months into the experiment, so clearly we need a far longer horizon to confirm if this performance edge is sustainable.

It also makes me wonder if there’s a lesson to be learned here..? No, not whether value investing out-performs in the long run – I’m fully convinced of that already! [And if you’re not, please please read some of the numerous papers published on the topic]. But whether a mechanical approach is perhaps better?

Ha! No, I’m certainly not planning on becoming a stock screening convert..! But I wonder: Even if you’re a v competent & disciplined value analyst, even if you’ve conquered much of the fear & greed involved in investing, perhaps that demon mind still trips you up at that v last hurdle, or two..? When you’ve a nice stack of portfolio candidates lined up, why do you then take a shine to some & not to others? Why does one special stock really get your heart racing, far out of proportion to its obvious prospects? Why do you end up triple invested in one stock vs. another, when they both lined up pretty much even-stevens in terms of risk/reward?

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TGISVP, Q3 2012 YTD Performance (I)

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Aer Lingus, Alpha Portfolio, Beta Portfolio, Cove Energy, CPL Resources, Datalex, Fastnet Oil & Gas, FBD Holdings, garbage stocks, junior resource stocks, performance appraisal, Petroneft Resources, portfolio performance, Prime Active Capital, Providence Resources, Siteserv, TGISVP, US Oil & Gas, Worldspreads

Now Q3 2012 is over, it’s time to revisit The Great Irish Share Valuation Project. Here’s my H1 2012 performance post, for reference.

First, note there’s been 1 de-listing – we already had the heads-up on it last quarter: Cove Energy (COV:LN) was taken out for GBP 240p in cash per share by PTTEP (PTTEP:TB). A marvelous result for most shareholders, except for a few over-enthusiastic latecomers that bid the shares up to GBP 270p+ in the dying days of a Royal Dutch Shell (RDSB:LN) vs. PTTEP tussle. [I’ll continue to include Cove – at its final GBP 240p value – for performance purposes for the rest of the year].

Note: Q3 2012 YTD performance for each stock is TGISVP specific – that is, performance is measured from the specific date (in Q1) I set a target price for each stock. [Apologies if you’d prefer to see actual YTD performance for all stocks – but I suspect there’d be a high degree of overlap in the winners & losers, anyway].

Hitting The Century (VII – Natural Resources)

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agri-business, BP, bubbles, correlation, garbage stocks, gold, Howard Marks, idiots, inflation, junior resource stocks, miners, natural resource stocks, oil, Petroneft Resources, QE, quantitative easing, Richland Resources, silver, Statoil, Total

In my recent Inflation post, I elaborated on my conclusion that, contrary to widespread (and my prior) opinion, inflation was likely to prove a fairly distant threat. Despite the smoke rising from the bloody printing presses… And despite the Fed since confirming their long-expected QE III – or should I say: QE Forever, QE Infinity, QE God Fucking Save Us… Take your pick! You know, the mind boggles – how/why on earth does the Fed confidently expect Agency MBS purchases to smoothly flow through into improved labour conditions?!

No real need to revisit my post, just read Howard Marks’ latest instead, which came out a few days later. In his memo, he covers much of the same ground – probably in a far better & more relentless manner… [And apologies if I ramble on: Remember, with this series, my intention isn’t to necessarily write about specific stocks here, old or new. Rather it’s to give you some deeper insight into the thoughts, logic and pros & cons underlying each of my allocations].

Siteserv – Best Irish Joke?

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distressed, garbage stocks, Siteserv, TGISVP

I recently commented on Siteserv (SSV:ID or LN) here, and as I worked on another set of valuations for TGISVP, I couldn’t resist returning to the subject:

Any chance the Exchange could put a health warning on this PoS?! Management muppets were recently forced (in response to media comment!) to come out with a statement. The key sentence is: ‘At this stage it is not possible to predict the outcome of this exercise nor quantify the financial impact for shareholders.‘ Don’t be fooled, there’s only one way this ever works out: Zero value or absolutely massive dilution for shareholders.

On The Way To Damascus…

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Damascus, garbage stocks, natural resource stocks, quantitative easing

Some people may have got the impression that I hate natural resource stocks..?!

Not true at all! In fact, natural resources in the ground are maybe one of the few things in our history that politicians and central banks have not been able to debase. You should definitely grab some (more) for your portfolio, especially now the Fed seems hellbent on reflating the US, and the entire world. (I recommend you watch this quantitative easing primer – v precise, and hilarious too!).

But if you stray from the industry giants, buying into the oil & gas/mining sectors is like entering the lion’s den. Be wary! The old quote ‘A mine is just a hole in the ground with a liar on top‘ still holds true far too often, except now the miners have such cushy numbers they actually believe their own hype…

Farming…Back in the US, Back in the USSR

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Alpcot Agro, Aqua Bounty Technologies, Black Earth Farming, farmland, Gain on Biological Assets, garbage stocks, Landkom, Market Cap/hectare, Petroneft Resources, Trigon Agri

Continued from here:

Now we can finally home in on my Top 6 most undervalued farmland companies. I’ve listed them according to their level of undervaluation:

Landkom (LKI:LN):  Ukraine – Oilseeds & Cereals  [(0.5) years]

Alpcot Agro (ALPA:SS):  Russia (92%, but half is leased) & Ukraine (8%) – Cereals  [0.8 years]

Black Earth Farming (BEFSDB:SS):  Russia – Cereals  [0.7 years]

Trigon Agri (TAGR:SS):  Russia (2/3) & Ukraine (1/3) – Cereals  [2.5 years]

MCB Agricole (4GW1:GR):  Ukraine – Cereals & Oilseeds  [(0.5) years]

Sintal (SNPS:GR):  Ukraine – Cereals  [(1.4) years]

Er, Throw That Fish Out – It’s Reached its Sell-By Date

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AIM stocks, garbage stocks, Hot Tuna, surf brands

On Thursday, I shared my bemusement upon rediscovering Hot Tuna (HTT:LN). Great memories, but an appalling valuation and share price history, and even more appalling management. I wondered ‘…is this the worst AIM stock ever?!?’

After a last gasp sales surge since then – yes, I believe they sold almost 50 t-shirts over the weekend – they woke up Monday morning with a God-awful hangover and empty pockets. Jeez, time to sell the rest of the t-shirts, the van, the drunk surfer girl in the corner who won’t wake up, even the damn Hot Tuna brand itself..!

Surfing Wipeout & A Charitable Plea

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AIM stocks, garbage stocks, Hot Tuna, Ocean Pacific, surf brands

Hot Tuna (HTT:LN)

Mkt Price:  GBP 0.07p

Mkt Cap:  GBP 1.6 mio

Randomly came across Hot Tuna the other day, and enjoyed waxing nostalgic about wearing their surfing t-shirts years ago, I literally wore some of them to death! This prompted me to take a closer look, without much hope, at its news/financials. Wow, even more entertaining than fondly remembering their t-shirts: Good God, is this the worst AIM stock ever?!?