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Another share buyback announced. I can't say that the last lot did much for the share price. I would rather have a dividend and then I can decide what to do with their spare cash
One of those little known gems in the market. I am surprised how few trades there are in it.
Just a comment from an old timer (74) who has been investing for the past 45 years. I built up a portfolio that just touched £1m then took a 10% hit thanks to Mr Putin a year ago. Last weekend I had a look at my portfolio records from 2010 and 2000 and earlier and they are unrecognisable from my portfolio today. Funds and companies come and go apart from the big stalwarts like Shell, BP, NG etc. I say this in the context that people say "I am in a particular stock for a 20 year horizon" etc. You probably won't be and don't listen to the the mantra that every fund manager comes out with about being in it for the long term, which is for their benefit not necessarily yours. You must constantly reevaluate why you have certain holdings and ask your self the question "if this item was cash in hand today would I buy it?". Be brutal - it saved me from the Woodford fiasco for a start.
OK rant over, time for my walk to the coffee shop and read the FT. :)
My point was not about Zip-line in particular. Its that I hope that the SMT people ask me searching questions of the rest of their potential investments. The fact that it's only 1.1% is irrelevant. I would expect a more convincing grilling than listening to what is effectively an advert and perhaps a statement of how the Zipline business is developing financially. They must have burned through a lot of cash.
Just been listening to the Zipline podcast from Scottish Mortgage. I used to be in the IT industry and heard loads of presentations like like this from smooth and fast talking CEOs (usually from the US) which sound sort of convincing until you ask a few questions like how is this making money? It talks about solving a problem of delivering medicines in Africa but no mention of the existing system in say Kenya (which I know) where lots of guys on motorbikes (called boda-boda) will turn up and deliver anything for a few £s or how do you make money delivering medicines in a third world country? It would have been useful if instead of listening to a company advert there was some searching discussion about the business model. What do others think?
https://info.bailliegifford.com/MTM4LVhJSi04NjcAAAGJcr8Y30MUifBjSQDU_WKIYANlpl4gEY6cJ6AaHIC3eI7rIxNuClsLYkmN837Lr-CQ8hgCvVc=
Even if you don't hold Fundsmith there are some interesting comments here from Terry Smith https://www.fundsmith.co.uk/analysis/ letter to shareholders 2022
There is talk below about the end of the war etc which reminds me that in 45 years of investing I have many times seen the regular mantra of "when things return to normal" If there is one thing I have learned its that this never happens. We will move to the next scenario/crisis.
My comments about BT was more about Tesla than SMT as a whole and about the emotion of buy and hold which can be dangerous. I gave up listening to fund webinars a few years ago since they all come out with the same story about buying potential and being in there for the long run which feeds their agenda of earning fees which they still do even if performance is poor. I am as guilty as most of you for stuff I should have offloaded years ago but I do find the SMT shareholders here to be rather refreshingly different to a lot of my other holdings where hardly any comments are posted. :)
I know that a few forum members think that I am overly conservative but it comes from a long history of seeing companies come and go. I remember in the late 90's having a block of about 2,500 BT shares and 3G was going to transform the communications world with the same narrative as 5G now. The shares were around £15 and I was about to sell when a BT exec told me that the analysts were predicting it would go over £17 so I hung on, and on and on. I finally gave up a a couple of years ago at around £2.50 and now they stand at £1.20. I am always reminded of this when I see a comment like "next time the share price is above 12" especially with a volatile share like SMT. You must always ask the hard question about any stock that "if this was cash in my hand today would I buy it today" and not just hand on in there hoping. Incidentally Tesla now has a PE of over 40 which is now double the S&P500
Investors should always be nervous :) At age 74 I have been investing for 45 years and have luckily dodged a number of bullets over the years (like Woodford). I have a large portfolio but as I have DB pensions I don't need to touch it so it has become a sort of hobby /game for me and keeps me busy. SMT is less than 5% of my portfolio but still over £40k worth and my worst performer this year
Reading a piece recently where it was pointed out that SMT has a lot of investments in unlisted companies (which we are all aware of) but as the value of the listed stuff reduces BG are hitting limits on how much unlisted they are allowed to hold in the portfolio. Selling a position in an unlisted company is difficult (as a certain Mr Woodford discovered). Makes me nervous.
Down 30% YTD and " 14 analysts offering 12-month price forecasts for Moderna Inc have a median target of 185.50, with a high estimate of 506.00 and a low estimate of 101.00 " Pharma is one of the most difficult areas to predict as there are so many unknowns. That's why the big outfits like GSK act like investment trusts and do little internal research but rely on small startups with good ideas to take the risks before funding extensive trials.
Just a point to throw into the discussion but in yesterday's FT there was a piece about Nestle where over the past 15 years they have spent 76Bn swiss francs in share buybacks and paid out 95bn in dividends and the share price has been falling for the last few years. Sounds like a strategy to destroy shareholder value.
No ITs at a discount don't all do buybacks . Some like Brunner have been around for 100 years and have a policy of not doing buybacks and run with sizeable 10-15% discounts. Also if you think about it, unless you are buying back with spare cash then selling assets in an IT to buy back shares in yourself is a bit illogical