When Labour Gets In

The question is what do investors do in the face of impending doom when the Labour Party stumbles across the line to win the 2017 election. 

Well they've started it already.

They have stopped buying Auckland International Airport Ltd [AIA.NZX] its moving backwards with a DIV coming,

Auckland Airport growth is bound to stall under a Labour Govt.

Labour's stated aim is to at least halve immigration and I think it will go completely the other way within 2 years - people will not want to stay.

The other thing Labour is going to introduce, a $25 dollar new tax for travelers to this country is going to have a major impact on tourists.

This will clearly impact further on Auckland Airport, it clearly has already.

Uncertainty certainly plays a part in it, there's no doubt about that but reality plays a big part as well and Labour's focus of their extra spending is on the unproductive parts of the economy. That has been the way of the Labour Govt's from year one.

But you don't get economic growth from putting taxpayer money into things like "higher wages for everyone" it is simply a blight on the taxpayer and business as a whole.

You've got to be focused on what you as an individual can bring to the table rather than Labour's view that whats on the table is mine and that extending the table through extra taxes and more Govt borrowing is the way to go.

Its not.

You've got to wonder about those companies that have got a high component of transport costs, Like Freightways and Fletcher Building. 

These companies have come off recent highs and they are nervous about what will happen when Labour gets into power.

Every company on the NZX  is effected by the probable change of Govt.

I'm not worried about my investments. I will take the time to look at each company in the Share Investor Portfolio and buy more when they get cheap enough.

That's the thing with long-term investing in shares and changes in Govt. You make your serious money in times of gloom and (like we will be heading to under a Labour Govt) and make even more in times of boom (like we are just coming off now - under National).

Either way I'm not disturbed.



AIA @ Share Investor

Auckland Airport: Look Before You Leap
Auckland Airport: Its a Buy
AIA: To Buy Now Or Not To ?
Share Investor Q & A: Auckland Airport's Simon Moutter


Freightways @ Share Investor 

Share Investor's Total Returns: Freightways Ltd 
Share Price Alert: Freightways Ltd 3 
Share Price Alert: Freightways Ltd 2 


Fletcher Building @ Share Investor

Share Price Alert: Fletcher Building Ltd 4
Share Price Alert: Fletcher Building Ltd 3
Share Price Alert: Fletcher Building Ltd 2




c Share Investor 2017

Of Wagging, Salivating Tongues

I'm getting nervous.

Why am I getting nervous?

Because the value of my portfolio keeps rising - I'm what you call a slightly negative investor.

The value of the portfolio is just over $ 509,000.00 and has climbed steadily since my incarceration ended at the end of May - from around $ 390,000.00.

It reached the half million mark at the beginning of the week and has put on nearly 20% in 2.5 months.

My finger is poised to sell but I just cant, yet, because nobody has been crazy enough to give me what I want.

I want to ditch the 10000 ASBPB shares I hold and FBU but think I can get more for these if I wait, and for some smaller holdings of others, BGR and HLG have done really well...350 plus %.

Starting to do well is FPH, well duh the dollar wasn't going to stay at that rate forever, it is the reason the stock is performing, not that the company is actually performing, as it has been for years.

Contact energy looks about to break of of its trading range of $5.30 - $5.50 and bout time to since it will be doing some sort of fine business in the countries heatwave/drought and this coming profit result should be a doozy - and it may be taken over by someone.

The WHS dropped into the green this week as I stepped back into the country after holiday - oh ditch the holiday moniker, seriously but it was up and I had one guy who took my advice to buy some last week, who did and he scored about 8 k - beat my 3k after about 5 years.

SKC is going up and up and up - notice a pattern there. Well it keeps reaching for the limit of the tower but it is one that apart from being up about 150% after 10 years and almost now practically free still owes me about 2 bucks per share.

Then there is FRE which has gone up about 90% but still bugs me that it has not gone further  - it will one day.

Then MFT always end with the good ones North of 120% and still looking like a winner.

What else can I say ?


Recommended Amazon Reading


The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition) by Benjamin Graham
Buy new: $14.95 / Used from: $6.99
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c Shareinvestor 2013

Freightways Ltd: 2011 Full Year Profit Analysis

The Full Year 2011 Freightways Ltd [FRE.NZX] Profit out this morning is a case of steady as she goes, with a few points to elaborate on along the way.

The 2011 full year net profit of $29,899 million is up by 29% on the 2010 result.

Revenue was up by 7% to NZ $352,520 million, indicating a good overall improvement in the company.

A dividend of 7.25c is to be paid compared with last years 7c.

The company seems to have finally hit its straps after having a few static and down years with the core express package & business mail division returning double digit earnings growth in the second and fourth quarters and its information management systems businesses looking promising after years of capital investment for growth.

Freightways expects growth from current customers for the 2012 year from their courier division and a payback from its information management systems investment as they gain scale and reputation in that sector.

Overall, the full year 2011 result has been a good indicator of a transition from static growth to a promise of more in 2012, after a rather unpleasant 2010.

Freightway's management are cautiously optimistic about company prospects for the coming year and this outlook has changed from the zero revenue growth and lower profits of the last few years in terms of the forward outlook.

This must of course tempered by the fact that the economy as a whole is shaky and any slowdown of significance will be felt by companies like Freightways first.

2012 could well go either way for the company.

9 out of 10.

Disc I own FRE shares in the Share Investor Portfolio

Freightways @ Share Investor

Share Investor's Total Returns: Freightways Ltd
Share Price Alert: Freightways Ltd 3
Share Price Alert: Freightways Ltd 2
Freightways Ltd: 2011 Half Year Profit Commentary
Share Price Alert: Freightways Ltd
Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011

Share Investor's Total Returns: Freightways Ltd

I have written about returns for stocks on a general basis in the Long Term View series of posts and the Long VS Short series but in this series, Share Investor's Total Returns, I will be giving my actual returns for stocks in the Share Investor Portfolio for as long as I have held them.

The return calculation will include dividends earned along with qualifying tax credits and of course any capital increase in the share price. It will be a total return over the length of holding of the share expressed in overall dollar figures with an individual value per share of what the stock currently is held at.

The forth stock in this particular series is a staple of the portfolio and one that I have held for nearly 4.9 years, Freightways Ltd [FRE.NZX]

The current holding of 8631 shares was kicked off by an initial purchase of 8200 in June 2006 plus 431 bought as part of a 2009 capital raising.

The stock cost a total of $30817.64. It has returned net dividends of $6871.00 and total tax credits of $3300.50, with $89.45 in brokerage.

I am eligible for the full tax credit so if the gross dividend (net dividend plus tax credits)is added and brokerage taken off my full return over the total holding period of 4.9 years is $10082.05

The current capital value of the company in the Share Investor Portfolio as at 13 May 2011 is $30381.12. The capital loss therefore is $436.52. This gives a total return on this share of $9645.53. This is a 31.3% return over 4.9 years or 6.38% net per annum.

I hold FRE therefore at a total cost of $20735.59 or $2.40 per share.


Disc: I own FRE shares in the Share Investor Portfolio


Share Investor's Total Returns Series

Mainfreight Ltd
Sky City Entertainment Group Ltd
The Warehouse Group Ltd


Freightways @ Share Investor

Share Price Alert: Freightways Ltd 3
Share Price Alert: Freightways Ltd 2
Freightways Ltd: 2011 Half Year Profit Commentary
Share Price Alert: Freightways Ltd
Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011

Craigs Investment Partners Picks Top Stocks

In a NZ Herald column this morning Mark Lister from Craigs Investment Partners discusses the virtues or otherwise of new investors buying "penny stocks" and the quality of the businesses that might be behind the stock price and as thinly on the ground as they are on the NZX, that you must look to the fundamentals of the business.

Mark indicates some qualities he would like to see in a business before investing:

1: A business without too much competition.
2: Good balance sheet with room for debt.
3: A track record of good and increasing earnings.
4: Generally defensive in nature.
5: Good management.

I agree with these 5 points but must add that I see good management as the first tick before investing, well above the other point Mark made.

I must also note buying cheap face value stocks is not always an indication that the company is a dog - it maybe just suffering a temporary dip in performance for whatever reason - but it is more often than not a good indicator.

With this in mind Mark has picked 11 stocks that fit his criteria and that he has invested his clients in and I will comment below on these picks:

The following is a list of stocks by the returns they have delivered over the past decade, using figures that we calculate ourselves for the 10 years ended March 31, 2011. These figures take into account dividends and capital growth in share prices and are adjusted for share splits, rights issues and so on. This list is not exhaustive and is obviously limited by space.

This list is not any sort of quality ranking, but it does show how well some of our companies have done over the past decade.

Freight-forwarding company Mainfreight Ltd [MFT.NZX] tops the list. It has returned 29 per cent a year over the decade, or a total return of 1216 per cent. In 2003 Mainfreight published a book on its first 25 years. It was a great read and it talked a lot about the 100-year vision for the company. In the years since, it has made rapid progress, cementing its local market position and expanding its operations around the world. Company leadership is top-flight and it has a strong focus on the long term.

TrustPower Ltd [TPW.NZX] comes next with a 10-year gain of 22.6 per cent a year. The Tauranga-based generator and retailer of electricity has carved out a defensive niche in it sector. Its strong renewables focus has been a point of difference, as has its ability to manage its retail operation better than any rival while maintaining its premium customer service offering.

Ryman Healthcare Ltd [RYM.NZX] is not far behind with 22.2 per cent a year. One of our market's biggest success stories, Ryman is a leading company in the aged care sector. It recently announced it will be expanding into Australia and locally will be increasing its build rate from 450 to 550 units and beds a year to meet rising demand for its services. Ryman has also grown its dividend handsomely. Investors astute enough to buy Ryman shares 10 years ago are enjoying an income from dividends of over 18 per cent a year on their original cost.

There aren't many big development or infrastructure projects in this country that happen without Fletcher Building Ltd [FBU.NZX]. This strong market share in construction and building materials has helped it deliver a return to shareholders of 20.7 per cent since 2001. The company continues to expand overseas.

A company that many people perhaps will not have heard of is Ebos Ltd [EBO.NZX], a healthcare distributor. It has returned 17.1 per cent a year and is another stock that has delivered strong dividend growth. It has a strong market position here and is expanding in Australia.

Port of Tauranga Ltd [POT.NZX] has returned 15.5 per cent a year and continues to go from strength to strength. Strong demand for logs from Asia is boosting export volumes and revenues, but this company is much more than a short-term story. It has built a strategically important position, has valuable land assets, good transport links and room to grow.

Auckland International Airport Ltd [AIA.NZX] comes next with a return of 12.6 per cent a year. The airport is New Zealand's key contact point with the outside world. Management continues its focus on developing the airport's property precinct and improving the overall service offering and efficiency.

Carpet maker Cavalier Corp Ltd [CAV.NZX] comes next with a return of 11.8 per cent a year. Cavalier clearly operates in a tough sector and faces strong competition, and has to cope with demand for its carpets moving up and down with the economic cycle. Despite all of this the company has done well and delivered excellent growth and dividends for shareholders.

Express package company Freightways Ltd [FRE.NZX] has delivered a solid 10.6 per cent a year over the decade. It is a well-managed company with strong brands such as New Zealand Couriers and Post Haste Couriers. It continues to expand its market position and has expanded into Australia in the information management sector.

Property for Industry Ltd [PFI.NZX] is one of the best-performed listed property vehicles with a return of 9.4 per cent a year. It has delivered consistent increases in its dividend over the years and has always impressed with its astute management of its portfolio of industrial properties.

No list of high-quality stocks in this country could exclude Fisher & Paykel Healthcare Ltd [FPH.NZX]. It produces world-class products such as heated humidification products including respiratory humidifiers, breathing circuits, infant resuscitators and infant warmers. It is a leader in products for the treatment of obstructive sleep apnoea. It has returned 7.9 per cent a year over the decade. Given 98 per cent of sales are overseas, the strong NZ dollar has impacted on results.

Mark Lister, NZ Herald, May 7 2011.

Now I haven't checked Mark's figures for accuracy but if you check below this post in the Long Term View series of posts you will find there are other stocks that have gleaned far higher returns than his picks, especially when you hold for greater than the 10 years he has covered.

I agree wholeheartedly with Marks first pick, it is the best managed company on the NZX, but he hasn't been critical of his other picks or pointed out that all of these companies have been impacted by the financial ups and downs of the last 2-3 years. Fletcher Building for example had a disastrous history through the 1990's and up to the point where Mark makes his calculations, the company they were before they became FBU almost went into receivership.

An essential point missing from Mark's stock picking criteria is timing of the investment. You must buy when the stock you are after is at a level where its fundamentals meet what current returns you are after and therefore what future returns you might get. There is no point buying what some might seem as good quality companies unless you include this as a feature in your picking.

Finally, it is great to see people like Mark putting their money where their mouth is and buying and disclosing what they are investing in on behalf of clients. It would be nice to see him disclose what he has in his own personal portfolio though.


Share Investor's Annual Stock Picks

Share Investor's 2011 Stock Picks: Looking Back
Share Investor's 2011 Stock Picks
Share Investor's 2010 Stock Picks
Share Investor's 2009 Stock Picks
Share Investor's 2008 Stock Picks

Brokers 2011 Stock Picks


Long Term View Series


ASB Capital Preference Shares (A)
ASB Capital Preference Shares (B)
Auckland International Airport
Air New Zealand
AMP Ltd
ANZ Banking Group Ltd
Briscoe Group Ltd
Cavalier Corporation Ltd
Comvita Ltd
Contact Energy Ltd
Delegats Group Ltd
EBOS Group Ltd
Fletcher Building Ltd
Fisher & Paykel Appliances
Fisher & Paykel Healthcare
Freightways Ltd
Goodman Fielder Ltd
Hallenstein Glasson Holdings Ltd
Hellaby Holdings Ltd
Infratil Ltd
Kirkcaldie & Stains Ltd
Kiwi Income Property Trust Ltd
Mainfreight Ltd
Michael Hill International Ltd
Metlifecare Ltd
Methven Ltd
Mowbray Collectables Ltd
NZ Oil & Gas Ltd
New Zealand Refining Ltd
New Zealand Stock Exchange Ltd
Nuplex Industries Ltd
PGG Wrightson Ltd
Port Of Tauranga Ltd
Postie Plus Group Ltd
Pumpkin Patch Ltd
Restaurant Brands Ltd
Ryman Healthcare Ltd
Sanford Ltd
Sealegs Corp Ltd
Scott Technology Ltd
Skellerup Ltd
Sky City Entertainment Group Ltd
Sky Network Television Ltd
Smiths City Group Ltd
Steel & Tube Ltd
Telecom NZ Ltd
Telstra Corp Ltd
Tourism Holdings Ltd
Trustpower Ltd
Turners Auctions Ltd
Turners & Growers Ltd
The Warehouse Group Ltd
Vector Ltd
Wakefield Health Ltd
Westpac Banking Group Ltd




c Share Investor 2011

Share Price Alert: Freightways Ltd 3

I have been watching the share price of Freightways Ltd [FRE.NZX] increase significantly over the last month. The share price has risen 40c or 13% to close at $3.45 yesterday on higher than average volume.

There hasn't been anything of a material nature for the rise in share price but the positive result out in mid February may have something to do with it and the market could think that prospects for the company for full year 2011 look better than they did last year.

I am not convinced either way as to what the company is going to bring to the market for 2011 and further on into 2012 so the recent share price rise might be a good opportunity for short term speculators to bail and for long termers interested in buying to be a little patient and wait for a pull back.

Buy on weakness.

Disc I own FRE shares in the Share Investor Portfolio

Share Price Alert Series

Goodman Fielder Ltd 2
Freightways Ltd 2
Telecom New Zealand Ltd 2
Ryman Healthcare Ltd
Charlies Group Ltd
Fletcher Building Ltd 2
Contact Energy Ltd
Steel & Tube Ltd
Telecom New Zealand Ltd
New Zealand Stock Exchange Ltd
Mainfreight Ltd 2
The Warehouse Group Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd 2
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
Tourism Holdings
Goodman Fielder Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd

Freightways @ Share Investor

Share Price Alert: Freightways Ltd 2
Freightways Ltd: 2011 Half Year Profit Commentary
Share Price Alert: Freightways Ltd
Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

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c Share Investor 2011

Share Price Alert: Freightways Ltd 2

As you can tell from the 1 year Freightways Ltd [FRE.NZX] chart above the share price of the company hasn't moved much in the last year. The stock is well off $2.62c lows reached in July 2010 and has been an erratic beast for the last year.

Like most other NZX stocks over the last year it is up on more positive economic sentiment but the reason why I have included it in today's post is that the stock has put on almost 10% in value over the last 2 weeks. The stock has risen from just over 3 bucks to close at $3.28 yesterday.

This is on no material news at all in March but on a big spike in trading at the beginning of the month. Who was buying on that day I don't know but the stock has rallied over 8% post that trading day.

The positive result out in mid February had an impact on share price at the time but the share price drifted down through the first part of March.

$3.30 seems to be the price ceiling for this stock of late and I think investors might want to wait if they wanted to add this stock to the portfolio because it could come back as the economy bites again mid Winter on this bellweather company.

Buy on weakness.

Disc I own FRE shares in the Share Investor Portfolio


Share Price Alert

Contact Energy Ltd
Air New Zealand Ltd
Telecom New Zealand Ltd
New Zealand Stock Exchange Ltd
Mainfreight Ltd
The Warehouse Group Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
Fletcher Building Ltd
Restaurant Brands Ltd
Mainfreight Ltd
Tourism Holdings
Goodman Fielder Ltd
Pumpkin Patch Ltd
Hallenstein Glasson Holdings Ltd
NZ Refining Ltd
Freightways Ltd
Xero Ltd


Freightways @ Share Investor

Freightways Ltd: 2011 Half Year Profit Commentary
Share Price Alert: Freightways Ltd
Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011

Freightways Ltd: 2011 Half Year Profit Commentary

The half year profit to December 31 2010 that came out this morning from Freightways Ltd [FRE.NZX] is an indication that life is starting to get better for the company in these tough times and as a bell-weather stock it perhaps is first evidence that the economy as a whole has picked up after all. I am still dubious about that though.

The net profit of is up 9% to $15,796 million on the comparable 2010 half year.

Revenue was also up by 7% to $176,166 on last year, a year in when revenue was down by the same amount so the net profit is a combination of slightly higher revenue and a focus on costs.

A healthy dividend of 7.25 c is to be paid compared with last years half of 7c, so it looks like management are confidant that the rebound has some legs.

Financing costs for a sizable company debt have also increased markedly over the half, by 13%, so that increase in dividend may not be wise after all -better to pay down the debt.

Naturally management are cagey about company prospects for the coming year given economic uncertainty and they see the possibility that their good result is "not sustainable", especially as revenue growth has not been consistent throughout the group's businesses. I would have to say that business operations and therefore revenue will probably come under pressure over the rest of 2011 and into 2012 and once again careful capital management and a focus on business costs will see them through another tough year until the New Zealand economy bounces back and real consistent growth for the company can return.

Overall, the half year 2011 result has been a good indicator of a very tough 2010 and an indicator that there is more patchiness to come for Freightways. The same can also be said about the New Zealand economy as a whole.



FRE has not traded at time of writing this morning with a big gap between buyers and sellers.
9 out of ten.


Disc I own FRE shares in the Share Investor Portfolio


Freightways @ Share Investor

Share Price Alert: Freightways Ltd
Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011

Share Price Alert: Freightways Ltd

I don't pay much attention to this company share price wise. Freightways Ltd [FRE.NZX] has been the 3rd largest stock in terms of purchase price in the Share Investor Portfolio and I have simply held for the last 6 -7 years and collected the healthy dividends.

The share price reached lows of just above $2.60 mid 2010 (see 3 year chart below) and plumbed those depths once at the end of 2008 and then again midish 2009.




The share reached an all time high of just over $4.75 at the beginning of 2007 (see 5 year chart below) and since then has been up and down more regularly than Charlie Sheen in a Hollywood whorehouse.



Over the last 2 months though (see 3 month chart at top of post) the stock has added 39 cents to close at $3.29 today. This is an increase of about 14% and the share price has broken through a barrier of around $3.25 last attained in May 2010.

Either there is good news coming up in the coming 2011 Half Year profit announcement to be made in mid February or the market thinks the company is onto a better thing as people are perceiving the economy is going to do better in 2011.

If you have been looking at buying it might be wise to wait until after the result because I don't see that the company would have done well enough to justify such an improvement in share price.

Look for weakness post Feb.


Share Price Alert

Xero Ltd


Freightways @ Share Investor

Freightways Ltd: 2010 Full Year Profit Analysis
Long Term View: Freightways Ltd
Freightways Ltd: 2010 Half Year profit commentary
Freightways Ltd: 2009 Full Year profit commentary
Freightway's Capital Raising more of the same crap for small shareholders
Long VS Short: Freightways Ltd
Freightway's keeps delivering
Why did you but that stock: Freightways Ltd
Freightway's delivers
Freightway's packages up a good result

Discuss FRE @ Share Investor Forum
Download FRE company Reports

NEW - From Fishpond.co.nz | Think Bigger, By Michael Hill

Join the Share Investor Facebook Group

c Share Investor 2011