RE: Royston Test Results will really boost shares30 Sep 2021 18:05
An observation as I have been doing this a while now.
On a ‘notable RNS day’ if the SP spikes like we did here to around 111 and then pulls back, like 99p the SP then tends to go on to achieve that high again, 111 and often higher.
If the SP drops, to a low point say from 165 to 140 and then recovers the SP then goes on to hit that low point again and often lower.
So if you buy on the day at 108, don’t sell because it then hits 99. Hold or add more on the dip.
If it drops and recovers and you haven’t sold it’s often worth selling at least some because it will likely go lower.
I have observed this pattern so many times, particularly on AIM. All said I am now exiting most of my higher risk stuff and using my capital gained to pick up divi payers on the market dips.
There are some absolute bargains atm and covid has helped highlight those with stronger balance sheets.
The likes of GLO, 6.6% yield , Quarterly, non uk energy play so should miss any windfall tax, dollar divi, helps with weak £! Divi 1.9x covered and they paid out through covid as it didn’t have any material affect on the balance sheet.
Furthermore, the management have signed up to a yoy divi increase of 10% and say that the stock is so undervalued that they will use any cash for acquisitions or to buy back own shares!
This is a £1.2bn company and yet there is hardly any analyst coverage and it’s often NT to buy 2000 shares! Even when the SP dips below 190 you can seldom buy at that price in scale.
Or TGA, look at the graph. I bought from 220 to 318 and expect to get a yield of + 30%! Completely miss priced by the market now frantically trying to correct. I emailed their IR guy to clarify the numbers and had a great reply. Simply undervalued!
Or even PHNX, I bought at 625 and get an 8% yield it paid through covid. SP dropped because an asset deal didn’t complete but balance sheet strong and Solvency ratio near 200%!
Similarly MNG not long listed. Bombarded with TR-1’s as insti’s juggle for position. Not valued yet imo. Tier 1 180% and I get a 9% yield & they want to give more to shareholders!
There are others.. yawn!
But you see even in the larger caps there are bargains. If you bag a few even if you get one wrong there’s still a decent income from the others and you can sell as there is usually liquidity unlike on AIM. The language is also fun shares ‘rocket 5%’ or ‘ crash 6%’ lol!
My point is if the market can’t value a billion £ company with that City firepower what hope is there for them to get TXP right!
I will be holding the likes of TXP and SAVE even though I am selling other AIM stocks as I think these will soon be very high yielding. SAVE could be yielding 50% on my 8p average if they match SEPL’s payout and I expect around 20% from TXP!
So if Shell want us I will have £10 please, that’s where my sights are with a fair wind even if the City can’t add up!
Trek
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