Share Investor's 2015 Stock Picks

Author at beginning of year.

I think I will pick stocks this year and give readers a chance to fill in the blanks yourselves.

Apart from the fact that the NZX 50 is up around 900 points to finish at 5530 today, you would have to say the index shows our market has been way overbought and is due for a correction, how much and when is a little harder to define.

That may also not happen, if America keeps on with its wacky ways.

With this in mind here we go.

Fisher and Paykel Healthcare

Quite high at the moment but long term readers will know I've picked this every year since I started this.

Give it a miss at these prices if you want to invest - it will get cheaper. But if your one of those short termers its worth grabbing. Will go north of $6.00.

Sky City Entertainment

This is the year I'm picking for this wonderful stock, it has almost paid for itself in 13 short/long years, divs.

I'm picking it to finally deliver in the last part of 2015. Momentum will see this stock in the high 5s.

The Warehouse Group

I'm picking this stock, because I have a hunch its dec statement to us, the public, will be a good one and its sales figures out in Jan will be more of the same. It is likely that a turn around has come.

Cross fingers.

Mainfreight Ltd

I picked this stock because of its ability to stick to its knitting, get the job done, and bring in the results.

Time after time.

2015 will be an outstanding year for the company.

Contact Energy

2015 will be a good year for Contact.

Although 2015 - 17 will be restrained in terms of demand, their supply will rewarded with historical lows in terms of cost of production.

Management have signalled either buy back, special div or higher divs for now and into the future.

Ryman Healthcare Ltd

This stock amazes me.

While it was languishing in the high 20s that's $1.20 during the financial crises of 2008 - 2011 it hardly rated a mention, I was buying it then (first disclosure).

It was making record profits then.

Now it and its sisters are making headlines once a week, how hot is the property market right now.

This will take off once the most recent profit result is known - this Friday 21 Nov.

Get it while you can.

Auckland Airport

This company is well on the road to earning the big bucks.

It wasn't long ago, 4 years ago, that it was making 100m, now it will do close to twice that.

Ain't going to have any competition, not while I'm or my daughters alive.

I see nothing but growth for this one, get on and fly.

Hallenstein Glasson Holdings

A brief one which I've traded 4x before that goes in cycles the way that it always has.

Management are aware things change - they have been in the clothing biz for over 100 years and know where it at, that is why I don't mind holding. They are a good company.

They are near the bottom once again and by most they appear to be making there way to the top again.

Heartland New Zealand

This one I picked last year @ 80 something cents.

I pick It again next year as it looks set to expand and grow revenue and profit.

Something tells me that this is a dark horse.

A Xero, in the making if you like, except this company makes a profit and has got a clear purpose.

Get it now for big future gains.

NZ Refining

NZ Refining is a cyclical stock and at present its in the low part of the cycle.

1.97 per share is cheap when one considers your buying 2.05 of NTA.

Get in while you can on good long term - 2 plus years - gain.

Trademe Group

If you can get this around $4.00 you could earn almost a buck a share next year.

It looks set to consolidate next reporting season, perhaps a we bit up and grow slightly during 2015.

Not a share I would own for a long time, has no future, but good to get in and out of on its way down to zero.

Team Talk

This one has been on my watchlist for years.

Its on the small-cap index.

Principally because of its dividend, which has been 2x 10c for long as I can remember but has recently come down to 7.5c x 2. The company say it will stay that way all of next year.

The share price has come down by more than the cost of the div making this a good long term bet to take off once it sees an improvement in bus.

Any improvement in the biz would see the div raised.

Air NZ

Just one last one to tempt the weak and perhaps make the very same strong if they hold onto this one to long.

If you can get this at 2.15 per share you should be good for the rest of 2015.

The running costs are going down and patronage is up.

Beautiful!

It will not last forever.


Warning

What not to buy!

At the time of writing this addition 19.12.14 11.30am the stock that I've got to mention is XRO. It is at $15.70 at time of writing and is set to make further slippages in 2015. It reached a high of over $45 and some and is many years away from making a profit - if at all. It has been 6.5 years on the NZX.

Stay away.

Conclusion 

As I said in the brief intro I think the index looks a little shaky.

I see a brief upswing in the new year then a tapering off throughout the year.

But we are talking a new reality, markets aren't going down like they should do.

America is doing things with its dollar that we haven't seen before and suffering the consequences - the market is going up not down.

The economy is lulling itself into a false sense of security, its not letting out the bung, it just continues to stuff it with continued monetary expansion.

O.k, I'll leave it there.

Except to say, they - America - cannot let the bung out, to do so would jeopardize world markets.



* As an addendum, the stocks from  Fisher and Paykel to Hallensteins are stocks in the share investors portfolio and are included because they are the bomb.

The rest are very worthy additions.


An Alternative to that biased, joke that is Sharetrader.


www.shareinvestorforum.com


Share Investor's Annual Stock Picks


Share Investor's 2014 Stock Picks
Share Investor's 2013 Stock Picks
Share Investor's 2012 Stock Picks
Share Investor's 2011 Stock Picks
Share Investor's 2010 Stock Picks
Share Investor's 2009 Stock Picks
Share Investor's 2008 Stock picks

Broker Picks

Brokers 2014 Stock Picks
Brokers 2013 Stock Picks
Brokers 2012 Stock Picks
Brokers 2011 Stock Picks



c Share Investor 2014, 2015

Share Investor's 2014 Stock Picks

2013 has been another great year for stocks rising almost 15% to roughly 4700 on the index so forget about what might happen and suspend belief for a nanosecond and take a squiz at what I have for you.

The stock picking monkey has been very busy this year with a few surprises.

This year the monkey had a really hard go at it but managed to get through quite a few interesting picks.

This year I have picked stocks based on nothing except value of the stock based on where I think it will go.

Please keep in mind dear readers that the picks are my own and they reflect my investment philosophy and not necessarily anyone else's.

This year I have sold some stocks, PPL, HLG, MHI, BGR and others, because I had to - My ex-wife said so - and some of them had run their natural course, about $110,000.00.

My picks are primarily based on a long-term view, regardless of the current short to medium term market turmoil and economic uncertainty, I pick a down year for 2014.

NB: Since I think most of my portfolio consist of the best stocks on the New Zealand market, I found it difficult to pick stocks outside my realm of self interest. This year I will give you the individual number of shares I have of each stock.



[RYM.NZX] Ryman Healthcare has got to be the pick of the bunch. One that I have held for at least 6 years I bought this one for $1.97 and it has returned at least 400%. I have 5000.

This had another record year this year of a 22% profit lift on last year of $58.5m.

It is looking good for the short to medium term but could face some hurdles when its housing stock needs modernizing because it is the company that owns the stock.

The big thing of recent weeks is the fact that their foray into Australia looks to have gone better than planned and they are going into the second stage of this development. They are also looking at another site.

This is not a stock that I'm currently buying but new investors could not find a better stock to get into.

Id climb into this one with gay abandon, especially if the Oz experience mirror ours and we find that out in March/April 2004.


[MFT.NZX] Mainfreight Ltd is only the second stock of mine that I deem is worth another glance in 2014.

Mainfreight has had an up and down year in respect of results with Novembers report indicating a profit up 7.7%  at $29.87m but some warnings about various divisions struggling next year.

I am however picking a stellar year for Mainfreight, with revenue up on last year and profits up at least 10% on most divisions. Why do I say this? Simply because of the way Mainfreight is designed for individual success, I am picking 2014 for Mainfreight to finally get things together and for that individual stuff to combine and really make things hot in 2014.

Buy on anything close to $10, with a view to long term gains.



[FPH.NZX] Fisher & Paykel Healthcare Ltd is a stock that I have picked for each stock pick series and here the reason why, well several reasons why it should be in your portfolio picks for next year.

This years profit result, announced mid November was a record at NZ$303.9 million, 14% above the prior comparable period as a result of strong revenue growth in the company’s two major product groups and that is set to continue next year.

The revenue is growing and set to grow further in 2014 and set to double in 5 years - it grew around 15% this year and is set to outstrip that in 2014.

Our dollar certainly cannot stay where it is for 2014, it is set for a big re-ratng because of interest rate hikes.

The product range is huge for 2014, and plenty of funds will be used to produce more for the new year.

Get in at under $4.00.


[SKC.NZX] Sky City Entertainment Group Ltd has had a good 2013, with a  FY 2013 profit at the hands of an excellent CEO who was able to win the Govts (national and local) over their plans for a convention centre and a number of strategies planned and executed to produce pleasing results for shareholders. The share price of the company has not however tracked its increased fortunes and has been trading in 2013 from $3.50 to just over $4.50.

It has also won the Govt over in Adelaide with a major revamp of that particular centre. with lower taxes as part of the deal.

This and the fact that all of their assets are competition free mean this one is probably the buy of all my picks this year.

Its had a profit downgrade on the 17th of  December but these things happen it will shine again - spectacularly .

At $3.60 this share is cheap, get it while you can.


[CNU.NZX] Chorus Ltd. This may seem an anathema to my usual picks and it is, it is purely a spectator play because I see it as very cheap at $1.45 and worth releasing at about $2.20-$2.30.

Most notably its asset backing is $1.21, so that leaves 24c for intangibles and that looks very cheap at that price.

No matter what the larger market may say about the dividends - and if they come at all watch for another rise - they will come again soon, and any way your not going to be in long enough to know or care about those.

Get them while you can.


[HLG.NZ] Hallensteins Glassons Ltd used to be a company I held for about 5 years until my wife considered it surplus to my requirements any way I made about an additional $4000 from a $2500 outlay. Considered that this had had its day. But wait bad news and its time to go sniffing again.

Hallenstein Glassons has warned investors it expects its first-half net profit to fall by 20 per cent compared to last year. The NZX-listed clothing retailer said it expected to post a net profit of $8 million for the six months ending February 1, a decrease from last year's interim net profit of $10.4m.

There has been the talk of international competition from various websites, tax free, and they may have a point, but this has happened before and Hallensteins has aways managed to counter this and get back margins.

I have done this before with this share and have held it overnight and have held long term, either way you will get your money back.

Buy up to $4.50.


[HNZ.NZX] Heartland Bank New Zealand Ltd has been a bank only since last December and its shares were trading last week at around 85c, what they are trading at now, below their net tangible asset value of 85.2c. Assuming the assets are valued accurately, the shares are therefore relatively cheap.

Profitability is low, sure, but it is improving. In the coming year, it is expecting net profit of $34m to $37m.

As a new bank, Heartland has been given more onerous capital requirements by the Reserve Bank than the established players. Its tier-one capital ratio - basically the equity as a percentage of risk-weighted assets - must exceed 12 per cent, while the requirement for ANZ and Westpac is 6 per cent.
 
They all exceed the minimum by some distance, but Heartland naturally has a little less headroom. Its tier-one capital ratio at balance date was 14.8 per cent, providing a buffer of 2.8 percentage points over the minimum.

You would do well to get them below $1, get them while you can.


[SUM.NZX] Summerset Group Holdings Ltd has a strong development pipeline for future growth. Five villages are currently under construction, including the recently acquired site in Dunedin. Summerset also has three quality land sites in Karaka, Katikati and Hobsonville and is continually evaluating new sites to support the development of further villages based on what is the sheer demand for units.

In 2012, 160 retirement units were completed at four of Summerset’s developing sites –Hastings, Nelson, Dunedin and Warkworth. Summerset now have 1,646 retirement units and 327 care beds.

The company has also purchased two new sites in Auckland: 7.6 hectares of waterfront land in Hobsonville and a prime 3.9 hectare site at Ellerslie. These sites bring their land bank to 1,400 retirement units and more than 400 care beds. The one in Hobsonville should be a cracker, pure waterfront, prime position, plenty of land for decent sized footprint.

This should do what  [RYM.NZX] & [MET.NZ] have done and defy all expectations and take off depending on what they all do come reporting season.

Get them while you can.


                    
Nasdaq

YUM! Brands Inc
[YUM.NASDAQ]



A pick from 2010, 2011,2012, & 2013 Yum ! Brands Inc has consistently grown each and every year and achieved a 40000 th store opening for 2013 and with more tasty growth to come in 2014 and beyond from China & India still make this company a Finger Lickin proposition. It will never be cheaper. China is the BIG growth story for 2014.
 

Conclusion & Outlook for 2014

2014 will be an interesting year for stocks, will they do what they did in 2013, unlikely. What we will have to wait and see is what the USA will do with unwinding there debt - will they,wont they - how China reacts to that and how Europe will do has a major effect on that.

As an investor, you must simply find value in the companies you invest in. Its out there, you just have to do a little research yourself.

You may not find this approach pleasing, if you don't find a broker and put your money with him or her.

These are my picks.


*Just an added footnote. Please feel free to post your own stock picks for 2014. The only requirement is that you say why and declare any financial interest. Post them below at the bottom of this piece or click here.


Disclosure : I own SKC, FPH, MFT, RYM, CNU, HLG, SUM shares in the Share Investor Portfolio.


Share Investor's Annual Stock Picks

Share Investor's 2013 Stock Picks
Share Investor's 2012 Stock Picks
Share Investor's 2011 Stock Picks
Share Investor's 2010 Stock Picks
Share Investor's 2009 Stock Picks
Share Investor's 2008 Stock picks

Broker Picks

Brokers 2013 Stock Picks
Brokers 2012 Stock Picks
Brokers 2011 Stock Picks





c Share Investor 2012, 2013, 2014

Heartland Bank NZ Ltd: A Good time to Buy?

Investors are finding it hard to value the relatively new listing Heartland Bank NZ Ltd [HNZ.NZX]. It was listed on Jan 25 this year on the main board of NZX after a merger of CBS Canterbury, Southern Cross and the financial services business of PGC (MARAC), and has had some mergers and restructures since then when PPG Wrightson Finance was subsumed into HNZ and $55 million of capital was raised.

HNZ shares were trading at 88c on Feb 1 of this year and are currently trading at 61c as at close of business yesterday. Either the market has no faith in the value that management put on it or the company is undervalued.

The fact that the merged company has been trading in its present form since the beginning of the year means it doesn't have a long track record to prove its value to the market but with net tangible assets at 90c per share, there could be some money made here if those assets are quality ones and have been valued in terms of the current discount of assets in a global market with little appetite for risk.

The only downside that I see -and it is a big one - is its large debt burden of 1.9 billion and assets in the form of 1.75 billion in receivables and $285 million in cash or equivalents. (see Jan 2011 accounts) In the current climate where debt levels such as these have sunk other companies, this is probably the reason why investors have been a little cagey and the market has discounted the company and its shares.

HNZ's intention to become a fully fledged trading bank in due course means that investors that come in on the ground floor could be in for good long-term gains as the company grows and they are able to negotiate their way through a dire global financial situation and maintain their receivables accounts satisfactorily if things get worse and are able to tap future borrowing at good prices.

There is room for a private company such as this one. Its main competitors are TSB Bank and Kiwibank at this stage and the failure of Kiwibank to gain a strong foothold in business and its low value clients in personal banking leading to net losses over its 10 year lifespan will be incentive for Heartland to push on with capturing unsatisfied customers from that bank and the main ones as it grows.

Heartland has forecast an inaugural profit of between 6-8 million to be announced August 19 and investors will want to see that sustained and grown over the 2012 full year before Mum and Dad start climbing on board for a piece of the future action.

It might just be good value at 61c.


Heartland Bank @ Share Investor

Discuss HNZ @ Share Investor forum
Download HNZ Company Reports




c Share Investor 2011