My 24 (boring) investments for 2014

December is always a good time to look at the portfolio and revisit the initial investment case in order to decide if all the investments are still “on track”. I did sort out a few already some weeks ago, so this is kind of “double checking” on the ones I decided to keep.

Warning: Almost all of my 24 positions are pretty boring. So anyone looking for “hot tips” might skip this post. As most reader might know, I prefer rather “boring” stocks. In order add a little excitment, I added the company logos this time….. 😉

Before jumping into the stocks, looking back at last year’s 22 for 2013, 14 of last year’s selection are still “in”. This is in line with my goal to have an average holding period of at least 2-3 years for the normal value stocks. The number of stocks has grown by 2 but this is well within my range of 20-30 positions I am targeting. I am not a big fan of extremely concentrated portfolios.

1. Hornbach Baumarkt

A stock which is in the portfolio since the beginning. Had to fight several headwinds in 2013 like bad weather in the all important first half-year, a (now bankrupt) competitor who was selling for cash flow (Praktiker) and of course the internet. Nevertheless in my opinion a very good, ultra solid long-term holding. Could surprise to the upside next year.

2. Miko BV

Plastics packaging and Coffee distribution. Strange combination, but again ultra solid and cheap stock with relatively good growth over the years. Could surprise to the upside because of lower input costs (Coffee.

3. TFF Group (formerly Tonnellerie Francois Freres)

Despite the good performance still a very attractive French stock. Typical, family run solid and long-term oriented business. As one of the biggest Oak barrel manufacturers, TFF did clearly profit from rich people in BRIC countries buying expensive French wines and Whisky. They did take over the number 2 producer Radoux some time ago and seem to harvest the benefits now. A “luxury stock in hiding” so to say.

4. Vetropack

Swiss based, ultra solid producer of glass bottles. Currently struggling both, with high energy prices and low growth in some of its main markets, esp. Eastern Europe. Nevertheless a solid position. Some potential upside via a new thinner but equally solid type of glass bottle which might even replace PET bottles.

5. Installux

Very cheap and unspectacular French aluminium parts manufacturer with large cash pile. Surprisingly resilient business despite the weak home market. More like a “deep value” stock. 4.3% dividend yield.

6. Poujoulat

Another unspectacular French small cap, specialist for chimneys of all sorts. Large top line growth via entrance into wood pellet business, however large depreciation reduced overall margins. If margins recover, stock could have a lot of upside.

7. Cranswick

UK-based “pork centric” food group. Again, nothing spectacular but very solid performance. Still cheap compared to the quality of the business

8. April SA

French based insurance broker / specialist insurer. Currently struggling with French health care regulation. Nevertheless still one of the most attractive business models for financials.

9. Sol Spa

Technical gases and healthcare related gas business. Very well run, good growth in the Healthcare sector. True strength not shown in the numbers due to large upfront write-offs. Long term holding.

10. Gronlandsbanken

Basically only bank in Greenland with high margins and good return. Potential upside if rare earth mining projects and other natural resources projects get started. Potential “Global warming” beneficiary. 8.3% dividend yield makes waiting easy.

11. G. Perrier

Interesting French specialist for electrical installations. Growing business especially in the nuclear power area. Barriers for competitors due to certification requirements.

12. IGE & XAO

French based software specialist for electrical CAD. Quasi monopoly in France. Good margins and good growth plus large cash pile. Shareholder structure might make some “corporate action” possible.

13. Thermador

Very interesting French home building and improvement supplier company . Unique “outsider style” business model and corporate culture. Currently struggling a little due to low domestic French demand but very good company at an attractive price. 4.6% dividend yield.

14. Trilogiq

French production optimisation company. Based on Japanese production philosophy, company provides solution and know how to optimise production. Active mostly in the car industry. Net cash, good margins and still cheap.

15. Van Lanshot

One of the leading Dutch Private banks. Did make some strategic mistakes in the past. Now with CEO trying to focus on “traditional” private banking. If turnaround is succesful and “normal” private banking margins can be achieved, stock has good potential. Additional tailwind because of tax crack down on Swiss private banks.

16. TGS Nopec

Seismic data company with an “outsider style” business model. Doesn’t own ships, was very disciplined in “Underwriting” explorations in the past. Currently more competition from struggling “traditional” competitors with ships and oil companies. If business stays “normal” significant upside. 5.6% dividend yield and share buybacks.

17. KAS Bank

Dutch bank, specialising in securities services. Due to low-interest rates, profitability under pressure. Will benefit if short-term rates start to rise. In the meantime, 6.7% dividend yield “sweetens” the wait.

18. SIAS SpA

Italian toll road operator. Very cheap infrastructure asset, “under leveraged”. Paid large special dividend but also reinvested in additional toll roads. If traffic in Italy stabilizes, stock has good upside.

19. Draegerwerk Genußscheine

Capital structure arbitrage. One Genußschein is equal to 10 preference shares but trades only at a multiple of 4-5 times. Patience required.

20. Depfa LT2 2015

Lower tier 2 bond of nationalised Depfa bank. At the current price solid 7% expected return p.a. until maturity 2015 with relatively low risk.

21. Commerzbank HT1 Funding

Tier 1 Commerzbank bond with a twist: Coupon is guaranteed by a third-party. At the current yield level of around 7% still a good “hold” until I have better ideas.

22. Rhoen Klinikum

I bought the stock after the first failed take over attempt. Now it looks like that the sale of the majority of the business to Fresenius will be cleared. To be sold if my price target of EUR 22.50 is hit.

23. MAN SE

Another special situation, betting on Volkswagen having to pay more than the 83 EUR compensation initially proposed after implementing a profit and loss transfer agreement.

24. Celesio stock /Convertible 2018

Newest addition to the portfolio. Speculation that acquirer Mckesson will have to pay more than the 23 EUR offer due to Elliott (Paul Singer) blocking position.

Current Watchlist:

1. Valmet, Metso Spin off January 2014
2. Portugal Telecom: Merger with Brazilian OI in 2014
3. Maisons France: Potential “outsider style” company in tough market.


  • Hi,

    I have a stock that you may like , U10, SA (another french stock);

    Can you give your opinion about it. I invested on this stock and I it is always good to have another point of view.

  • In regards to Poujoulat. How were you able to read the annual report… Can you read French?

    • I had som eFrench in school…after reading the 20th French report, it got better….i do read Italian, Spnish and even ROmanian annualreports without really knowing the language.Google translate helps a lot though…

  • A quite large portion of your portfolio are French companies. Since France is widely considered the biggest problem in the Eurozone (next to Italy) going into 2014 I am wondering what your take on that is and whether you see your positions influenced by that worsening economic environment.

    • thank you for the question. Yes, I do own quite a couple of French stocks. In my opinion, investing with the consensus is a sure path to underperformance. Investing against the consensus doesn’t guarantee success, but in my opninion, combined with solid bottom up research, increases the chances for above average returns.

      I could write many pages about this but the core philosophy is eays: Value Investing mean always investing against consensus. So if everyone is negative about something, the chances to find value exactly there are highest.

  • Frage zu SIAS: Haben Sie sich auch mit der Muttergesellschaft ASTM S.p.A. Azioni beschäftigt? Ist die SIAS oder die ASTM der bessere Kauf?

    • ich hatte zunächst ASTM, habe dann aber wie im Blog ausführlichst beschrieben in SIAS getauscht. SIAS ist die beaufsichtigte Gesellschaft die direkt die Assets hält. ATSM ist nur eine zwichengeschaltete Holding wo man nie genau weiss was als nächstes passiert.Von daher bevorzuge ich SIAS.

      • Danke für die Info. Bei ASTM ist mir aufgefallen, dass die bei einer Marktkapitalisierung von rund 980 Mio. € auf Net-Cash von 1,072 Mrd. € sitzen. D.h. 12€ pro Akite

      • Net cash is negative. Look for net financial indebtness instead of net current cash.

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