Monday, November 11, 2013

Aastra to merge with Mitel

Today, it was announced that Mitel (Nasdaq:MITL) (TSX:MNW) will be merging with Aastra Technologies (AAH).

http://www.cbc.ca/news/business/mitel-buys-aastra-in-400m-telecom-merger-1.2422219

Aastra shareholders will receive $6.52USD per share in cash, plus 3.6 shares of Mitel. Since we do not identify Mitel as a valid shadow stock, we will sell our Aastra at market value today, which amounts to $31.63 per share at the time of sale, for a total gain of $1340.22 on our initial purchase of $1003.59, a gain of 134%.

This is making me wish I had actually invested instead of just following this in theory!

Saturday, October 5, 2013

Quarterly Update - Oct 2013

The portfolio is still doing very well. Aastra Technologies (AAH) has done amazingly well. We have now more than doubled our money on Aastra, including the special dividend that was issued in August.

Brampton Brick is still the problem child (the only stock in the red), but it is still making money so we will keep it.

There is one new stock to the portfolio this quarter - TVA Group (TVA.B) which was $8 at the time of selection. They are a subsidiary of Quebecor media and operate French-language TV stations, as well as being part-owner of Sun News Network.

TickerNameIndustry# Shares
IEIImperial Equities IncDrug Retailers232
AAHAastra Technologies LtdTechnology Equipment51
GDLGoodfellow IncApplied Resources115
BBL.ABrampton Brick LtdConstruction Materials179
PFBPFB CorporationChemicals179
ALCAlgoma Central CorpTransportation68
VCMVecima Networks IncTechnology Equipment225
TVA.BTVA Group Inc
Broadcasting & TV
125

Detailed performance data can be seen on the Google spreadsheet.

Sunday, July 7, 2013

Quarterly Update - July 2013

The portfolio continues to do well this quarter. It's up 4.33% (including dividends) since the beginning of the year, while the TSX is down 1.47% (including dividends).

Brampton Brick is still the only stock in the red (if you include dividends). However, their earnings for the past year are positive so they remain in the portfolio despite two successive losing quarters.

Unfortunately, I think my screener may have made a mistake in selecting Algoma Central corporation. Its market cap is 544M at the moment, and I can't imagine it grew by a factor of 10 in only 6 months. However, as it currently fits the criteria to keep a stock in the portfolio, I'll keep it. If it grows much more it will have to be sold (600M market cap).

There were no changes to the portfolio this quarter, and no stocks have been put on probation yet.

TickerNameIndustry# Shares
IEIImperial Equities IncDrug Retailers232
AAHAastra Technologies LtdTechnology Equipment51
GDLGoodfellow IncApplied Resources115
BBL.ABrampton Brick LtdConstruction Materials179
PFBPFB CorporationChemicals179
ALCAlgoma Central CorpTransportation68
VCMVecima Networks IncTechnology Equipment225

Detailed performance data can be seen on the Google spreadsheet.









Saturday, April 6, 2013

Quarterly Update - April 2013

This quarter has gone well for the portfolio. It's up 2.57% (including dividends), compared to a 0% total return for the TSX. Including dividends, all stocks are in the green except for Brampton Brick. Vecima Networks issued a $1/share special dividend, which helped a lot - based on price alone, it's down 11%. But with the dividend, it's still net positive.

The quarterly review found one new stock to add. It's a very small company ($41M market cap) called Imperial Equities (ticker IEI on the TSX), which seems to do oil sands real estate as well as pharmaceuticals. Strange mix, but it fits our criteria so it is added to the portfolio.

For our existing stocks, three of them lost money last quarter but all still had positive earnings for the past 12 months, so nobody's on probation yet.

The updated portfolio is as follows:


Ticker Name Industry # Shares
IEI Imperial Equities Inc Drug Retailers 232
AAH Aastra Technologies Ltd Technology Equipment 51
GDL Goodfellow Inc Applied Resources 115
BBL.A Brampton Brick Ltd Construction Materials 179
PFB PFB Corporation Chemicals 179
ALC Algoma Central Corp Transportation 68
VCM Vecima Networks Inc Technology Equipment 225



Detailed performance data can be seen on the Google spreadsheet.










Thursday, January 3, 2013

Stock list posted

Just a quick update - I've added in the buy prices on the stock tracking sheet. I chose the buy prices based on the opening price for December 31, even if that wasn't the optimal price for the day.

Saturday, December 29, 2012

December 2012 - Starting List

The current list of stocks selected by the method is as follows:

Ticker Name Industry
AAH Aastra Technologies Ltd Communications & Networking
GDL Goodfellow Inc Forest & Wood Products
BBL.A Brampton Brick Ltd Construction Materials
PFB PFB Corporation Commodity Chemicals
ALC Algoma Central Corp Marine Freight & Logistics
VCM Vecima Networks Inc Communications & Networking

To track the portfolio, I will take a sum of $10,000 and divide it such that $1000 is invested in each stock (or as close as possible). There are only 6 stocks selected by the initial screen, meaning $4000 will remain in "cash" and will be used to purchase new stocks in future quarters, if appropriate. 

Performance will be tracked on a Google spreadsheet, so it can be viewed at any time and will always be up to date. I'll do the initial "buys" on Dec 31 sometime during the day, and the starting price will reflect the ask price at the time I check it. Once a quarter I'll update the buy/sell list here on the blog.

Interestingly, Aastra & Vecima seem to be very similar businesses, both of them making communications technology for businesses. And Goodfellow, Brampton Brick, and PFB are all involved in construction. So it's not a very diversified portfolio, but such are the hazards of value investing. 

Sunday, February 5, 2012

Introduction

I came across the American Association of Individual Investors (AAII) Shadow Stocks portfolio in late 2011. This is a stock-picking method that focuses on smaller stocks with the potential to grow big. They call them "shadow stocks" because they're in the shadows of the stock market, and most investors don't pay attention to them. I was very interested in it, as they claim that it has an annual return of 18% over the past 10 years (vs 2.5% for the S&P 500). I read the rules of how they determine the stocks, and noticed that one of the rules was that no foreign stocks should be purchased.

Being Canadian, if I were to follow their rules to the letter, I cannot look at their stock picks at all, since by definition all of them will be foreign. I therefore decided to follow their rules and come up with my own list of shadow stocks for the Canadian market, which I will be tracking on this website.

I'll start in December 2012, with a hypothetical $10,000 invested in 10 stocks. I will update the performance on a monthly basis, and review the portfolio quarterly.