Thursday, March 26, 2009

Share Investor's 2009 Stock Picks: Looking Back

Back on December 17 2008 I picked a handful of stocks that I thought were good ones to pick up while they were cheap. Most of them I already own but some I don't.

It has been the most read article on the Share Investor Blog and like every successful smash hit it deserves a sequel.

I have added 3 additions to the picks at the end of 2008. They are at the end of this post.

Over 3 months later lets see how they have done. The chart below compares my four original picks; Fisher & Paykel Healthcare, Mainfreight Ltd, Pumpkin Patch and Ryman Healthcare against the NZX 50 gross index.

The NZX 50 gross is down around 2% since December 17 2008.

Fisher & Paykel Healthcare

My first pick was Fisher & Paykel Healthcare [FPH.NZ] and I picked it for its very good long term outlook and its resilience in times of economic downturns.

How has it done since then ?

Well against the NZX 50 about 20% better and against itself share price wise around 4% better than December 17 2008, to finish at $3.16 today.

It has been as high as 15% up from December 17 levels on March 11 2009 and the company is due a good result in May thanks to higher sales and a stronger US dollar.

Not a bad pick by me and the share price will pick up more this year.

Related Links

Fisher & Paykel Healthcare financial data

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Ryman Healthcare

Ryman Healthcare was my second pick and one again its long-term prospects was the main reason I included it in my 2009 picks and in my long-term portfolio.

How has it done in the last 3 months?

Down 4% more compared to the NZX 50 and down 3% as of publish date of this column compared with its share price on December 17 2008.

Pretty good result so far.

I also picked Metlifecare [MET.NZ] for my watchlist. A competitor of Ryman Healthcare it has done badly since December 2008.

Related Links

Ryman Healthcare financial data

Ryman Healthcare @ Share Investor

Why did you buy that Stock? Ryman Healthcare
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Mainfreight Ltd

Mainfreight Ltd [MFT.NZ] is one of the better run companies on the NZX but the share price hasn't done well since we last met it in December.

It is down 8% compared to the NZX 50's 3% since December 17 2008, even though its recent profit was up slightly.

Related Links

Mainfreight Ltd financial data

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Pumpkin Patch Ltd

Pumpkin Patch Ltd [PPL.NZ] was well and truly battered and bruised during 2008 with a 60% share price drop so I figured there was room for some upwards movement in share price.

It reached a low of 78c earlier this year but it is actually up by around 4% since December 17 2008.

Related Links

Pumpkin Patch Ltd financial data

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Other Quotable Notables (Part 2)

Telecom NZ [TEL:NZ] is at exactly the same price it was on December 17 and my pick remains to buy on weakness close to 2 bucks.

Contact Energy [CEN:NZ] Trustpower [TPW:NZ] and Vector[VCT:NZ] are still good buys and Contact Energy has lost 15% of its share price since December 18, mainly due to regulation uncertainty and clearly the weakened share price makes it even more attractive. Trustpower remains pretty even and Vector has risen around 5%.

Auckland International Airport[AIA:NZ] has rise a few percentage points and still remains a strong buy on weakness.

Westpac [WBC:NZ] and ANZ Bank [ANZ:NZ] have both risen by 15% in the last 3 months .

Additional Stock Picks for March 26 2009

I would include all my December 17 2008 picks on share price weakness and would include the following.

Goodman Fielder [GFF.NZ] because it is near its all time lows while still an attractive long term proposition.

Michael Hill International [MHI.NZ], like Goodman, its share price has been given a good beating and I think great value. Its in good financial shape but under short-term pressure from a sales slowdown.

Sky City Entertainment [SKC.NZ], my biggest holding, has been beaten down since December 2008 but has still managed a good profit result for half year ending December 31 2008, buy on any weakness below the current share price of NZ$2.78.

Disclosure: I own RYM, FPH, PPL, AIA, SKC, MHI, GFF and MFT shares

Related Share Investor Reading

Share Investor's 2009 Stock Picks

Related Amazon Reading

Free Cash Flow: Seeing Through the Accounting Fog Machine to Find Great Stocks (Wiley Finance)
Free Cash Flow: Seeing Through the Accounting Fog Machine to Find Great Stocks (Wiley Finance) by George C. Christy
Buy new: $32.97 / Used from: $37.39
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c Share Investor 2009

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