Stock of the Week: Hallenstein Glasson

The resilient result out late last week for Hallenstein Glasson [HLG.NZ] prompted me to add this company to the Stock of the Week list. A profit down from last year nonetheless but a result that shows promise for better to come and a well managed business in very troubled times.

Like every other stock on the New Zealand sharemarket this one has taken off recently (see one year chart above) and at NZ $3.03 it is higher than it was over a year ago when the economy really hit the fan and people stopped shopping but it has been alot pricier at a high of over $ 5.75 3 years ago (see 5 year chart below)

Another attractive selling point is its consistently good dividends that have been paid over the long term and this has been the result of maintaining costs to a minimum and growing sales and therefore cash flow to pay that dividend.

It is paying a gross return of over 10% at today's share price of $3.03.

If you are interested in a good long-term investment get in on general market weakness come October.

Good Luck!

Hallenstein Glasson @ Share Investor

Hallenstein Glasson Australian expansion needs expert execution
Why did you buy that stock? [Hallenstein Glasson]


Disclosure: I own HLG shares in the Share Investor Portfolio

Stock of the Week Series

Mainfreight Ltd
Fisher & Paykel Healthcare
Xero Ltd
Auckland International Airport
Sky City Entertainment Group
Burger Fuel Worldwide
Michael Hill International
Contact Energy Ltd
The Warehouse Group
Fisher & Paykel Appliances


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John Key rings Wall Street Closing Bell

Following a great honour and tradition for Celebs or politicians to close trading for the day on Wall Street, New Zealand Prime Minister John Key rings the bell for close of trade on September 24 (NY time) on the New York Stock Exchange.

Is a tradition long celebrated on the NY Stock Exchange and for John Key to get to do it just shows the respect he still has from his years on the Street.

Hey, I am still here but baby is taking up our time lately.

I am working on an interview with Don Braid, Managing Director of Mainfreight [MFT.NZ] and that should be out in a few weeks.

Until then, enjoy the video and imagine it is you !

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The Power of Dividends

Just like interest, dividends are a powerful addition to ones investing hand.

When re-invested in good companies they can make an average return a spectacular one over the long-term.

In the Share Investor Portfolio, which has been in action in one form or another for the last 7 years I have received just over NZ$113,000 in dividends and tax credits, not bad for a portfolio that is worth only around $320,000 on today's valuation and one that has been considerably smaller in its early days.

All of the cash has been reinvested back into the portfolio, as have the tax credits which I am able to use fully.

The bulk of the dividends come from just one stock, Sky City Entertainment Group [SKC.NZ] making up over half the booty, then much smaller amounts from The Warehouse Group [WHS.NZ] Freightways Ltd [FRE.NZ] and Mainfreight [MFT.NZ] until they taper off to just a couple of thousand for the smaller stock holdings.

While dividends are not always a sign a company is doing well, often a higher dividend payout reflects that a company's cash turnover is a good one and then they are able to pass that turnover onto the shareholder.

A high dividend though should never be the only criteria for buying a stock.

I expect the dividend contribution to the Share Investor Portfolio to at least pay enough as to provide enough income over the next ten years to double the value of my investment, regardless of any capital value fluctuations from week to week and year to year.

Just what a good business should do.

Recent Share Investor Reading

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Capital Gains tax a millstone for New Zealand Inc

A question of intellectual dishonesty, economic illiteracy and empire protection by politicians and their hangers on currently surrounds the topic of a capital gains tax on investment housing.

We all know why investment housing is so popular and does so well in this country. There are countless tax advantages that this form of investing has over every other investment class, not the least one being the lack of a tax on capital gains, so it is bleedingly obvious as to why every Tom Dick and Harriet has an investment property.

The lax of taxes helps make for a successful investment, any investment, a third form economics student will tell you that.

Stockmarket investing is taxed to the hilt, as is investing in your own business, as are your savings in a bank or in a retirement scheme.

We all know how badly these investment classes, and our economy have suffered as a result of high taxes, while at the same time investment property is favoured above all by having no State hand reaching into your pocket.

So you think I want to tax investment property to even out the score?

Hell no.

Here is something quite radical and perhaps a little outside the square. Why not drop taxes completely on all asset classes?

That way investors will have a true choice about which investment they might want to make based on its merits or otherwise and if they invest in a business directly or a business indirectly on the stockmarket or put money into a savings account, the money is more likely to go into something productive rather than an over priced investment house with phony tax advantages and it will lift the economy as a result.

Aint that what we need, especially right now?

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