Portfolio update

Portfolio update

I’ve made several changes to my portfolio recently.

I have increased my holding in Craven House Capital (LSE:CRV) substantially to around 30% of portfolio. This is my highest conviction pick, and I’m am convinced this is a no lose situation with at least 400% upside. I explained my thesis here.

I have sold Deckers Outdoor after some weak performance of sales and I felt that the current price fairly reflected the prospects of the company. In hindsight I entered into this position much to early at $60 on initial bad news and overpaid for the stock. It wasn’t a clear undervalued play, I can see that now, selling for roughly 12x historic earnings and predicting a steep decline. The stock further fell to $35 where I increased my holding and it was more obviously an undervalued company, this is the level I should have been looking for all along to get a margin of safety. Overall I made 17% on the investment, which annualised equates to 21%. I’m not pleased with that given that I made 69% on the second round of buying and regret the initial purchase.

I have entered a position in Novus Energy, it now makes up 6% of my portfolio.

I have sell orders placed with ambitious limits for my entire positions in Cranswick and IBM. Cranswick is at the top of my value range and I have the order in at a price I feel leaves little upside in the long term. IBM has continually posted disappointing results since I bought and I feel I over-estimated the growth in its earnings. Given a revised outlook I feel its at about fair value so put in an ambitious limit order, if it hits I will still have made a nice profit.

I also have a limit order to reduce my position in Amlin by half. It currently makes up 14% of my portfolio which I think is too high considering it is no longer a deeply undervalued play. I will take some gains on this but will keep a position because it is a great long term buy and hold.

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Investing Sidekick

Founder of Investing Sidekick. Works as a research analyst and is an avid value investor, always searching for undervalued shares.

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