All German Shares – Part 3

And the next 10 shares in this series:

Nr. 20: Magforce AG

123 mn EUR Nano-Medtech company claiming to develope a cancer cure. Sales so far negligible. Not my area of competence, so “pass”.

Nr. 21: Bijou Brigitte AG – ISIN: DE0005229504

This used to be actually one of the first stocks in my portfolio but luckily I sold out. It used to be a fast growing, super profitable chain of cheap jewelery and assesoires. These days, it still has 300 mn EUR market cap but competition and other issues make it a stagnating/shrinking business. Optically the company is quite cheap (high net liquidity) but there is little hope for any changes to the upside although they have started a share repurchase program.  The orginal founder has retired and as often, the second generation doesn’t have much to add. Nevertheless I would put them on my extended “watch list” but not with high priority.

Nr. 22: Bremer Lagerhaus Gesellschaft AG – ISIN: DE0005261606

37 mn market cap logistic company (port operator), majority owned by the local City Government.  Although the dividend yield (~4%) looks attractive and infrastructure assets are hot, one of my mental models is to never invest in something dominated by a Government owner, so “pass”.

Nr. 23: Novetum AG – ISIN DE000A13SUY8

1.6 mn EUR Nano-cap. Seem to have no sales. “Pass”

Nr. 24. Rocket Internet – ISIN: DE000A12UKK6

3.9 bn market cap interent pioneer. I had written about Rocket some months ago. Started as a company builder, now trying to transform into a kind of VC. Rumours on a planned “going private”. “Watch list” as a potential Special Situation

Nr. 25 Expedeon AG (ex Sygnis, ex Lion Bioscience) – ISIN: DE000A1RFM03

Ex “Neuer Markt” company with several name changes. To be honest, I do not understand what they are doing (something Nano-Medtech) and therefore pass.

Nr. 26 Aladin Healthcare Technologies SE – ISIN:DE000A12ULL2 

This is a 125 mn market cap company which seems to have undergone a few “permutations” from something with new media to Blockchain and now “healthcare Technologies. The company has almost no sales but “Great prospects” in China and India. Thank you & “pass”.

Nr. 27: Fraport AG – ISIN: DE0005773303

7 bn market cap Airport operator. As with Bremer Lagerhaus, the biggest issue is that local Government owns more than 50%, so a clear“pass”for me despite an “ok” valuation and a attractive underlying business.

Nr. 28: Oldenburgische Landesbank – ISIN: DE0008086000

Small regional bank in the process of being squeezed out. “pass”.

Nr. 29: Matica Technolgies AG – ISIN: DE000A0JELZ5

Company specializing in physically issuing cards. However seems to have somehow delisted and current reports are hard to find. “Pass”.

Nr. 30: Centrotec Sustainable AG – ISIN: DE0005407506

A 193 mn EUR market cap company with a very interesting product portfolio, i.e. specializing in energy efficient technologies for buildings. Majority owned by the founder, quite cheap (P/E of 11) and growing. The company unfortunately is not very profitable (EBIT margin ~4-5%) despite the building boom in its core market Germany. Nevertheless one for the “watch list”

15 comments

  • Hi mmi,
    Great series. I think that now is a good time to look at CYAN AG.

    • Thanks. But as mentioned i will look at the stocks in a completely random Basis.

    • Haha, VBA, what a joke company.

      • Do you have a particular angle of analysis / short thesis on it? This is clearly an outlier and a “trust me” story given the very limited track record and the lack of disclosures. There is almost no sell side coverage. They have just guided for 35m sales (almost 100% growth due to Orange contract ramping up) and 14m EBITDA 2019 (only 3 months of business left). Someone with valuable insight on their business could build a compelling case from here.

  • Hi MMI,
    also ich verstehs manchmal nicht. Bei 150 Euro wollen alle nachkaufen, bei unter 40 will die Aktie keiner mehr. 😉
    Wäre Bijou nicht als reiner Dividendenwert interessant? Also in der Hoffnung, daß sie die jetzige Dividende weiterzahlen können (selbst wenn sie sich halbiert, könnte ich immer noch damit/davon leben). Mit 7,8% gehört in Deutschland zu den höchsten Dividendenrenditen. Mit Ausnahme des letzten Jahres reichte der FCF dafür, und einen Riesen Haufen Cash haben sie ja auch noch.

    • Ich glaube dazu müsste man sich das Kerngeschäft noch besser anschauen. 8% sind schon ein Wort…

    • Bijou ist ein schönes Beispiel für “IFRS 16 in action”. Über 170m EUR zusätzliche Verbindlichkeiten in H1 2019 auf der Bilanz, das meiste wohl Mietverpflichtungen für die >1000 Läden. Zählt man diese zu den Finanzverbindlichkeiten (und ignoriert das “Mietasset”), dreht das Nettocash in ein Nettoverschuldung.

  • I love what you are doing here, I have looked way too little at German listings, this is so helpful for me! Thanks a lot mmi

  • Is that ‚mental model‘ only valid for Germany (and why)? Just asking since the government of Romania is the main shareholder of Electrica & Romgaz. It’s not always that bad to have a public entity as a large shareholder, especially if you’re an infrastructure asset (keeps competition at a distance, and the risk of being squeezed/expropriated/publicly harassed is arguably lower).
    How do you ‚randomize‘ your selection?
    And where do you get your list from? It’s obviously outdated, OLB has been squeezed nearly a year ago.

    • I use this model in general. And to be honest: Electrica has quite some issues with its main shareholder which results in the unsatisfactory performance of the company.

      The source of the list has been mentioed in the first post. It is from Wikipedia.

  • Oldenburgische Landesbank was famous for their Grünkohl dinner at the AGM, but valuation and growth was not exciting. Also had problems with their credit cards frauds this year.
    By the way: How does the watchlist work? Is this just a list or is it sorted by discount to intrinsic value estimate or something like that? Or do you have different watchlists like “prospects to look at”, “waiting for right valuation” etc.

  • I like this series. Once owned Orbis AG from Part 2 (in 2015), but unfortunately sold too early. Bet you will later pass Halloren Schokoladenfabrik (only listed in Hamburg) and Seven Principles 🙂

    The guys from ‘Aktien mit Kopf’ had a nice Podcast regarding FRAPORT about 2 years ago. Just if anyone is interested in an audio-summary of the company.

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