Dwell+Done

Small re-balancing for the portfolio as Diageo appears to be quite fully valued at the moment: I sold 20 shares out of 50 for 145,49 USD per share. I used the profits to buy 13 shares of Johnson & Johnson for 119,138 USD per share and 4 shares of Lockheed Martin for 316,8008 USD per share. Johnson & Johnson is a core holding of mine trading at the low end of the 52 week range and has a yield close to 3 percent – that pretty much explains my timing here. Lockheed Martin Corporation on the other hand has a huge backlog but isn’t particularly cheap. However it fits my strategy in many ways, space exploration related actives being one of them.

Busy day today. My primary broker has campaign for small orders and problems in Italy were causing falling valuations here and there. Especially banking and finance sector was hit. I decided to seize this opportunity and bought 200 shares of Citycon for 1,856 EUR per share and 10 shares of Sampo Plc for 42,05 EUR per share. In addition to this I sold my Fortum shares held in my secondary account and replaced those with 72 shares of Nordea Bank AB bought for 8,255 EUR per share.

Loudspring announced today that the CEO will leave to company and chairman of the board will replace him. They claim that it was mostly for personal reasons but who knows. It could very well be strongly recommended action for the CEO and/or natural development given the new strategy. I decided to buy additional 160 shares for 1,236 EUR per share. Next 10 years or so will tell if this was a wise move to make.

See: http://news.cision.com/loudspring/r/loudspring-appoints-new-ceo,c2514697

There are companies that tend to always trade with significant premiums. Sometimes it’s because of the undisputed quality and 3M Company sure fits that description. Today however we saw significant drop in the share price after slightly lowered guidance. I wasn’t really planning to buy anything especially since I already increased my stake in Philip Morris but since this is a rare occasion, I decided to open a new position with a purchase of 20 shares for 199,80 USD per share. This barely fits under the debt balance limit I’ve defined in my strategy but barely is enough in this case.

See: https://seekingalpha.com/news/3347916-3m-slips-lowering-guidance-range

I’ve been thinking about my Philip Morris position for quite some time now as it has been quite modest but there really hasn’t been any great possibilities to steal additional shares with cheap enough prices. Today they reported results and, despite quite OK results, the share price tanked over 12%. This presented a situation where I had to make up my mind. It has plenty to love as a company: it’s an addiction business with strong R&D with their heated tobacco line. They do business outside of USA which perhaps provides some protection from legal issues. Though it should be noted that the very same protection might hurt in short term should they build a business out of weed as it’s probably going to happen first in the US. Factoring in all this I decided to buy additional 25 shares for 88 USD per share.

See: https://www.marketwatch.com/story/philip-morris-tops-profit-estimates-but-revenue-falls-short-2018-04-19

Small maintenance purchase as I bought 40 Loudspring shares for 1,478 EUR per share. This is a high risk position which I intend to build up with extremely small orders. It’s difficult to value a company such as this as there’s not much data available from the companies they own. Therefore I’ll keep the position small and will analyse the results in 10+ years.

Portfolio maintenance buy for March consisted of 10 Fortum Corporation shares bought today for 17,68 EUR per share. Nothing special here as I’m still in mainly in maintenance mode. Plan is to make these small purchases of Fortum, Loudspring and probably Citycon until debt level improves. It has improved nicely as the current D/E ratio is 0,0725 which already is below my target in normal market conditions. It’s another topic if we’re in normal market conditions and I really haven’t yet decided if I’m aiming 0,05 ratio or even eliminating the whole debt component.

I wasn’t expecting too much from Yara but the results they reported were still a slight disappointment. Dividend cut was also proposed which doesn’t fit well for a income oriented dividend growth portfolio. Therefore I decided to sell all my 80 shares for 335,70 NOK per share. I redeployed the money right away and bought 100 Telenor shares for 173,10 NOK per share and 3000 NEL Hydrogen shares for 2,858 NOK. This in part implements the short term strategy in which I plan to focus on digital services (Telenor) and sustainable energy (NEL) among others. This will also protect the dividend income stream received in NOK as lower yield of Yara was replaced with higher yield of Telenor. NEL doesn’t pay a dividend so it’s a long term value play with some M&A potential.

See: https://www.nasdaq.com/article/norways-yara-q4-lags-forecast-proposes-dividend-cut-20180208-00137

Second unplanned purchase for the week as Citycon dropped today after earnings. Considering the overall market phase and key metrics, this purchase made enough sense for me to pull the trigger regardless the deleveraging plan. I bought 1000 shares for 1,94 EUR per share. This and previous Apple purchase will pretty much make up the whole dividend reinvestment for the year and it’s not even March yet.

See: https://www.citycon.com/sites/default/files/citycon_financial_review_2017.pdf