Wednesday, July 22, 2009

Commonsense VS Politics

The dumping of the introduction of folate into our daily bread by National just shows us how politically motivated our politicians are rather than acting on facts (well duh Darren).

The Nazi style move by Labour and its continued support to introduce folate into our bread shows us that the left still want to control us, but the fact that this wasn't rejected quickly by National is a worry.

The use of folate of any kind is a personal choice, to say otherwise is to go down a track that would ultimately have citizens eating what politicians want from State owned markets (with long lines and shortages no doubt) and we rejected that at the 2008 election.

To have National making the move based on political motivation rather than a question of personal choice or the fact that there are questions about synthetic folate and the danger of it, is just more of the same crap that we put up with over the last 9 years of the heavy handed socialist/nazi style regime that Labour presided over.

This political rather than fact based governance is really just a lie, all it does is keep the ignorant and stupid happy and keeps the incumbent Government's poll ratings up.

The same can be said of the global warming nonsense that National are continuing with.

It is a a clear myth acknowledged by most yet the bullshit rolls on simply because it buys votes from the rabid left vocal sector of our country, never mind that the facts are that the whole GW frenzy is a lie.

This way of governing is the rule of the vocal moronity and it is a sign of weakness from the Government.

For god sake, have your own ideas, act on commonsense and fact and forget about the politics.

If John Key doesn't stand firm on something for the right reasons, his Government is going to fall due to the line adhered to and moved by the dropkicks and looney lefties in Government departments and interest groups that he is currently listening to.

Lets see the commonsense that we were promised before the election.




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I'm buying: Time to re-visit an old Red Friend

I love good stocks when the market is ignoring them. One stock that has been put in the bottom draw by many investors, including myself, is The Warehouse Group [WHS.NZ].

But just because a stock is out of favour by the market or not in the news doesn't mean you should forget about it. In fact if you are canny you should probably be more than a little contrary as others are looking at other more "newsworthy" companies.

I have kinda forgotten the red shed myself, I have had WHS shares in the Share Investor Portfolio for a number of years and have done a little bit of reading lately on the company and I like what I have to read.

Profit has been steady during the this recession (so far) and the cash continues to roll in as shoppers look for bargains.

Add to this a couple of stories, one from a month or so back from Bloomberg and one out today covering the Woolworth's Australia profit and things start to look a little more interesting for The Warehouse.

The Bloomberg piece covers off Woolworth's capital management and alludes to either a stock buyback for its own scrip or a "major" purchase in the offing, suggesting The Warehouse as a target.

Another article by Reuters confirms a bumper profit for Woolies, so they are free flowing with lovely green stuff.

The purchase/buyback scenario will probably be confirmed by the company when it reports its profit in August.

I bought 7000 shares today at a combined value of approx NZ$26,000.00 @ an average share price of $3.72.

My incumbent shareholding in this company, 8000 shares, was bought originally at $6.05 but I hold at a cost of $5.05 after dividends and tax credits are added after holding for 1.75 years.

I am happy to buy Warehouse shares and forget about them again but there is a distinct likelihood that either Woolworths or Foodstuffs, Woollies competing bidder, will make a play for the company in the medium term.

The bid for The Warehouse has been held up in litigation between the 3 parties involved and as I wrote back in January in When will the Warehouse bidders make their move? the process has now ground to a halt after the Commerce Commission won their case in the Appeal Court almost a year ago and Woolworth's sought leave in the Supreme Court to have that decision quashed a few weeks later.

Many things have changed since then, the major stumbling block to the takeover, the Extra format stores, has been dropped and economic conditions have made the retail environment even more competitive.

Watch this space.


The Warehouse Group @ Share Investor

Warehouse 2009 interim profit a key economic indicator
Stock of the Week: The Warehouse Group
When will The Warehouse bidders make their move?
Long vs Short: The Warehouse Group
Warehouse bidders ready to lay money down
The Warehouse set to cut lose "extra" impediment
The Warehouse sale could hinge on "Extra" decision
The case for The Warehouse without a buyer
Foodstuffs take their foot off the gas
Woolworths seek leave to appeal to Supreme Court
Warehouse appeal decision imminent
Warehouse decision a loser for all
Warehouse Court of appeal decision in Commerce Commission's favour
MARKETWATCH: The Warehouse
The Warehouse takeover saga continues
Why did you buy that stock? [The Warehouse]
History of Warehouse takeover players suggest a long winding road
Court of Appeal delays Warehouse bid
The Warehouse set for turbulent 2008
The Warehouse Court of Appeal case lay in "Extras" hands
WHS Court of Appeal case could be dismissed next week
Commerce Commission impacts on the Warehouse bottom line
The Warehouse in play
Outcomes of Commerce Commission decision
The fight for control begins soon

Discuss this stock @ Share Investor Forum

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c Share Investor 2009

Share Investor Portfolio: 22 July 2009

The Share Investor Portfolio now contains 17 stocks listed on the NZSX. The bulk of the portfolio started back in 2002 and I have added to the bulk of it by using dividends and cash.

Since the 10 July 22 update approx NZ $35000 was added due to two stock purchases made today, 1875 shares in Mainfreight Ltd [MFT.NZ] and 7000 shares in The Warehouse Group [WHS.NZ].



The Share Investor Portfolio as at 22 July 2009
  • Auckland International Airport [AIA] 5000
  • ASB Capital NO. 2 Ltd [ASBPB] 10000
  • Briscoe Group Ltd [BGR] 3000
  • Fletcher Building Ltd [FBU] 1114
  • Fisher & Paykel Healthcare Corp Ltd [FPH] 5000
  • Freightways Ltd [FRE] 8631
  • Goodman Fielder Ltd [GFF] 2000
  • Halleinstein Glasson Ltd [HLG] 1000
  • Kiwi Income Property Trust [KIP] 1000
  • Mainfreight Ltd [MFT] 5000
  • Michael Hill International Ltd [MHI] 10000
  • Postie Plus Ltd [PPG] 2535
  • Pumpkin Patch Ltd [PPL] 5000
  • Ryman Healthcare Ltd [RYM] 5000
  • Sky City Entertainment [SKC] 36915
  • Steel & Tube Holdings Ltd [STU] 400
  • The Warehouse Group Ltd [WHS] 15000
Previous Portfolio Updates

Share Investor Portfolio: July 10 2009
Share Investor Portfolio: June 15 2009
Share Investor Portfolio: May 22 2009

Related Share Investor Reading: Why did you buy that stock?

Why did you buy that stock? [Fletcher Building Ltd]
Why did you buy that stock? [Freightways Ltd]
Why did you buy that stock? [Kiwi Income Property Trust]
Why did you buy that stock? [Hallenstein Glasson]
Why did you buy that stock? [Briscoe Group]
Why did you buy that stock? [Fisher & Paykel Healthcare]
Why did you buy that stock? [Pumpkin Patch Ltd]
Why did you buy that stock? [Ryman Healthcare]
Why did you buy that stock? [Michael Hill International]
Why did you buy that stock? [Mainfreight Ltd]
Why did you buy that stock? [The Warehouse Group]
Why did you buy that stock? [Goodman Fielder]
Why did you buy that stock? [Auckland Airport]
Why did you buy that stock? [Sky City Entertainment]


Discuss this topic @ Share Investor Forum

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c Share Investor 2002-2009

Insider Trading on Sky City shares




Most people who watch the New Zealand Stockmarket closely know that there is frequent trading of shares based on insider information, the New Zealand Stockmarket is just like a small town, everyone knows everybody else's business.

I am not a share price follower, more of a company watcher but I have been looking at movements in Sky City Entertainment Group [SKC.NZ] share price pretty closely over the last 9 years or so.

I have come to the conclusion that Sky City is one of the biggest insider traded stocks.

Every reporting period you can always get a good idea about the profit result before it comes out, based on whether the insiders have traded on good or bad company news.

Yesterday's announcement of an upgrade in Sky City profit is a case in point in insider plays.

A very large volume of almost 8 million shares valued at nearly NZ$ 24 million was traded and the share price ended up 19c or just over 6.5%.

Over the last few days Sky City share price has taken a marked rise (see chart above and data below) and big volumes have gone through over the last 3 trading days.

Date
Open
High
Low
Close
Value
Volume
21 Jul 2009
2.880
3.100
2.880
3.050
23923490.3
7798468
20 Jul 2009
2.790
2.860
2.780
2.860
6702303.15
2373190
17 Jul 2009
2.660
2.780
2.660
2.780
18663101.84
6845077
16 Jul 2009
2.730
2.730
2.670
2.680
5240196.25
1942297
15 Jul 2009
2.660
2.690
2.630
2.690
2766984.42
1041257
14 Jul 2009
2.630
2.650
2.620
2.650
3258738.82
1240619
13 Jul 2009
2.660
2.660
2.620
2.620
1262989.85
480511
10 Jul 2009
2.680
2.690
2.650
2.650
1367532.26
514690
09 Jul 2009
2.640
2.680
2.640
2.680
1810909.48
676984
08 Jul 2009
2.630
2.650
2.620
2.650
5499837.7
2087514

Data From NZX

As I mentioned in a column on Monday there was big volume going through on Friday the 17 July when over $18 million of stock was traded and the stock was up 10c. Insiders have known for a while about the profit upgrade because the stock price has risen from a recent low of $2.58 to finish nearly 30c higher at close of market Monday 20 July, before the profit upgrade was made public yesterday morning.

The bulk of insider trading was done on Friday the 17 July, bought by institutions/brokers for a quick buck and a large part of that was sold back to the mum and dad investor today.

It isn't necessarily wrong for insiders to know about profit upgrades like this one because they get briefed and updated by company management before the great unwashed, but it is illegal for them to trade shares in the company based on that knowledge.

Unfortunately nothing will be done by Mr Mark Weldon, CEO of the NZX , because it is his colleagues (the brokers) that are making money, and his NZX is clipping the ticket along the way as large volumes of shares are traded.

Who needs a monkey with a dart when you can trade on insider info?

Disclosure I own SKC shares in the Share Investor Portfolio

Recent Share Investor Reading

Discuss this topic @ Share Investor Forum


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c Share Investor 2009