Tiny maintenance purchase for secondary portfolio to keep the streak going. I bought additional 60 shares for 1,96 EUR per share. Slow build up to medium sized position is in the cards during next six months or so.
Monthly maintenance purchase and this time around it was CoreCivic. Pandemic has calmed down a bit but is far from over. Meanwhile black lives matter movement has been wreaking havoc especially in US. All this together with the approaching US presidential elections should keep prisons full in coming years. It’s difficult to see how private prisons would be scaled down any time soon. There are long term contracts in place and new ones have been signed relatively lately. Therefore I bought additional 80 shares for 12,27 USD per share.
Not much to say. Everything is down. Occasionally some go up. So much winning. Bought additional 40 shares of Sampo for 28,40 EUR per share. It might go down or up if it doesn’t stay still. It will be trading ex div relatively soon and they have cut this dividend only twice so far. Hopefully they will forget third cut. Long term everything should be fine… maybe.
EPR Properties has been hit hard but it has already bounced back quite a bit. I’m putting my money on EPR surviving this COVID-19 panic. Sure, it will take time. Sure, they might have to reduce or even eliminate dividend. Sure, people might permanently stop golfing or skiing. I’m guessing that they won’t. In fact I’m quite sure that once the dust settles, there will be huge demand for that kind activities. Therefore I bought additional 30 shares for 29,90 USD per share. Let’s call this a speculative purchase.
There has been relatively many positive factors for Fortum lately. Uniper posted solid results, Fortum is getting positive publicity – well some negative as well for the coal usage – and Inderes increased target price today to 17 EUR per share. Share price hasn’t really noticed any of these so I bought additional 67 shares for 14.96 EUR per share. Considering the future potential, company metrics and overall state of the economy this appears to be very acceptable valuation.
Maintenance purchase since Fortum was trading ex dividend today. Bought additional 13 shares for 14,825 EUR per share. Uniper posted great quarterly results yesterday but that wasn’t too clearly visible on Fortum share price at least today. Could have bought more but I’m still keeping an eye on things and pacing myself.
Corona is hitting everything and REITs especially. Sure, temporary suspension of dividends is likely but that’s somewhat irrelevant short term noise. Private prison REITs appear to be very cheap as they were first hit by the political risks due to the presidential elections and then with the corona disaster which may very well spread in prisons in uncontrollable manner. This is unfortunate of course but for the long term not much has been changed. I doubt US government will scale down the usage of private prisons who ever may be sitting in white house in any given year. Considering the current economic situation and US way of living, it’s difficult to see any path in which there would be meaningful decrease in crime and punishments that follow. In worst case scenario these REITs could sell their portfolio to the government and I would be perfectly fine with that as well. With this in mind I bought additional 80 shares of GEO Group for 11.57 USD per share.
Corona keeps on spreading and insanely large stimulus packages are being created. Don’t get me wrong, I absolutely believe that situation requires massive public spending. The problem is that there has been plenty of unsustainable public spending for a decade or so already. This keeps the door open for inflation and interest rate problems in the future though there’s a solid case for deflation as well. This is the reason for my debt re-structuring during the last six months or so as risk mitigation. Running very low debt to equity ratio makes it much more easy to face this kind of turmoil both in stock market and in the underlying economy. So far the impact on portfolio has been easily manageable even thought REIT heavy allocation hit the portfolio hard. Even though the main portfolio carries some debt (which is offset with cash & equivalents elsewhere for liquidity and counter party risk offset purposes), lowest interest rate level was maintained in portfolio during the last drop.
It’s really hard to say where stock will go in short term. I wouldn’t be surprised if we will see a major correction in either way during the next three to six months. Therefore I’ll maintain disciplined approach and buy through this cycle while maintaining the low debt to equity ratio. Eventually all this stimulus money will go somewhere even in Europe. Germany being involved, I believe Uniper (of which Fortum owns a majority share of) will be in good position to either benefit from the stimulus with energy transformation focus or to behave as as more stable and defensive play in extreme bear scenario. Having this in mind, I made small Fortum purchase with 20 shares bought for 13,455 EUR per share.
Panic is spreading even faster than Corona virus. I’ve moved to normal buy mode and therefore bought additional 40 shares of Fortum for 13,265 EUR per share and 40 shares of Sampo for 24,7 EUR per share. Fortum in general is very defensive (relatively at least) and Uniper opens up huge possibilities going forward with the energy transition which is likely to benefit from various stimulus operations in near future. Sampo has dropped very quickly and can be called cheap at the moment. Short term it may very well go further down but current valuation opens up interesting possibilities for purchasing own shares or aggressively buying Topdanmark.
Corona is hitting hard and that’s likely to continue for months. This is also affecting Fortum which is in interesting position with Uniper considering the fact that they are also soon changing CEO soon. That’s a shame as I’m quite a fan of the current CEO Pekka Lundmark. It remains to be seen who will take his position but I’m sure the board will find a proper replacement. Change might even be a good thing with all the turmoil in Uniper during this acquisition. Now that Uniper is also moving on with hydrogen, it has become even more interesting. Being a fan of falling knives I decided to buy 60 shares for 16.65 EUR per share. Smallish starter position but perhaps I manage to buy more in coming months. Current market is finally presenting some decent valuations. I’m especially looking into Aflac, Sampo, 3M and Abbvie. Lodging sector is also one to watch as it has been hit really hard but I suspect that it will not correct itself quite as quickly.