The Shares Researcher

Less than a month ago, I posted about Spice Private Equity. In the meantime, the sale of its stake in Leon Restaurant has been completed and the majority of the cash received. This is, of course, good news and the share price bumped from less than $10 to almost $16 per share. Last month, it was outlined that the target price is around $15. Even under the most optimistic scenario, it is a ‘present’ that the price increase has happened so fast and why not lock in the profits reached in such a short time frame?

Today, we are going to look back and talk about some potential changes in the stocks discussed since the beginning of 2020. Due to the very benign stock market after the initial COVID-19 shock, most of the shares discussed on here have done rather well, some even extremely well. After such a huge recovery, it might be wise to quickly check the initial investment thesis and potentially make some changes where the stocks have reached the estimated intrinsic value. Let’s go over the potential changes one-by-one: -La Doria: Having hugely benefited from the crisis, it seems that the valuation is now closer to intrinsic value. Reminder: The price per share was below €9 when initially discussed on here and trades now at around €17. Although there is no doubt that the company will operate well in the months and years to come, it might be prudent to lock in some or all of the profits. All in all, the stock has advanced roughly 88% in local currency, not including dividends. -K-Bro Linen...

Intro Spice Private Equity is a Swiss stock market listed investment company focused on global private equity investments. The portfolio is split into the following categories/companies (‘fair market’ value as of end of 2020 in brackets): Leon Restaurants ($33m)   Bravo Brio ($26m)   G2D Investments ($18m)   Rimini Street ($13m)   Legacy Portfolio ($12m)   Cash and other current assets ($24m) In sum, the portfolio is valued at ~$126m in the company’s books and with 5.4m shares outstanding this translates into a book value (NAV) of ~$23 per share since there is literally no debt in the company. A word of caution for Spice Private Equity: trading liquidity is rather limited and might be too low for certain investors (largest shareholder holds around 60% of the shares). Further, although listed in Switzerland, the shares are trading in US dollars. Valuation The stock is currently trading at $9.25 – compared with an NAV of $23 at the end of 2020, a hug...

Intro Basler Kantonalbank is a mid-sized Swiss bank with deep roots in the Canton of Basel, where it was founded in 1899. The bank is fully owned by the Canton Basel City, however, has listed participation certificates listed on the Swiss stock market. The bank enjoys a very strong balance sheet with a total capital ratio of around 19% (vs. a minimum of 12%) and leverage ratio of above 10% (vs. a minimum of 3%). Historically, Basler Kantonalbank was strongly focused on its own Canton, as is the case with almost all cantonal banks in Switzerland. For a few years however, the bank has been pushing the roll out of its ‘online-bank’ under a separate entity called Bank Cler, which is not tied to specific locations anymore and potentially shows good growth potential as more and more bank clients use easy to use apps on their smartphones.   Valuation The capital of the owners is basically split into two categories: The first is the endowment capital, which is fully held by the C...

For many investors, the current investment climate is bizarre and new lockdown rules are not well received for investments as well as consumption. For this reason, ‘online’ companies are still in high favour (although stagnated a bit recently) and many other firms, for instance, that need factories to actually manufacture a physical product, are out of favour. Since the dawn of this blog, focus has always been on value; speculation or lofty promises have been tried to be avoided. So far, the results have been mediocre at best and at the beginning of this year, it was rather difficult to find attractively valued shares – a situation that has changed completely with lots of long-term opportunities available now. Some of the investments discussed on this blog have performed rather well, while others have gotten much cheaper and most of them show a better risk/reward situation than at initiation. It is imperative to think about current macrotrends; however not to get too much drifted a...

Intro Fresenius is a global healthcare group offering products and services for dialysis, hospitals and outpatient treatment. Fresenius is split into four different segments: 1) Fresenius Medical Care is the world leader in treating people with chronic kidney failure; 2) Fresenius Helios is the largest private hospital operator in Europe; 3) Fresenius Kabi is a supplier of essential drugs, clinical nutrition products and medical devices; and 4) Fresenius Vamed plans, develops and manages healthcare facilities. A lot of segments, but it is crucial for the reader to understand at least to a certain their business. Since its beginning in 1912, Fresenius has grown in each of its business units to a leader and generated revenues of more than €35 billion in more than 100 countries. The largest shareholder is the Else Kröner Foundation with 26.6% of the shares and guarantees a long-term, sustainable vision.   Valuation Fresenius was able to steadily increase its EPS from €2.64...

Intro Walgreens is a global leader in retail and wholesale pharmacy with a history going back to 1849. The company is present in more than 25 countries delivering to more than 250,000 pharmacies, doctors, health centers and hospitals. Besides an impairment for its assets in the UK by approx. $2 billion, the firm has ‘survived’ COVID-19 rather well with 2% higher sales for the full year ending in August and growth of 2.3% in the last quarter compared to last year. While it might be that the retail segment will decline over time due to online sales, Walgreens has partnered with Microsoft and Adobe on the digital front and its e-commerce business has shown strong sales growth, especially this year.   Valuation Mainly as a result of the UK impairment, EPS for the last 12 months has been under pressure albeit still being decently positive. Adjusted for these negative events, the company’s adjusted EPS would have been $4.74. However, a real figure might be more in the area of...