Markets closed now. How did we do?
JJB Sports closed to 0.361p -3.16%. It was up substantially in early trading, though. Those who bought at around noon yesterday at 0.586p are likely still waiting for their dead cat bounce. It’s not time out yet, though. Should be interesting to see if it reaches above 1p at any stage. Spread is 25%. Ouch! Yesterday I made a note that it was about 8%. Going to be difficult to make any money with those spreads, though. It’s interesting to watch the bulls and the bears fight it out on this one. The bulls are of course admitting it to be a high risk trade, with a near-certainty of 0p in the end, but they’re still expecting a dead cat bounce before then. Bears are speculating that a pre-pack might be organised over the weekend, the bulls are saying that there are interested parties who might want to do a deal, so there’s no need for an imminent suspension. The bears believe that any opportunity to offload shares is a good one, so buying is completely the wrong strategy. Trading volume in this share is phenomenal. It’s the highest traded share on LSE by volume today, at 239m shares. JJB has 406m shares in issue. Lots of shares changed hands today. It seems that Invesco has sold out of their position. Not one of their better investments, I would think.
LMI closed to 573.23 -1.93%.Strikes are still a problem, so the outlook for the covenants can only be getting worse. Here’s a bizarre bit of news: “South African prosecutors charged 270 platinum miners from Marikana with 34 counts of murder, using an obscure Roman-Dutch common-purpose law often used under apartheid. The workers were killed in a single day of violence on August 16, largely by bullets fired by police.” Odd logic to that one! Anyway, it looks like my original assessment that the bad news hasn’t been fully priced in yet was correct. And I do like being correct.
RIMM currently $6.67 -0.60%. Down 54% YTD. Prem Watsa, “Canadian Warren Buffett”, is in deep with one, at a vastly higher price. He also has a seat on the board. In April of this year, Whitney Tilson said that RIMM and Nokia were in “full-scale collapse”. Looks like Prem is going to have a Bill Miller moment on this one. Either that, or he will be hailed as an investing genius. Thing is, given the high-tech fast-evolving nature of the phone business, it’s hardly a company that I’d call “Beffett-esque”. I’m hoping that my assessment that RIMM is doomed proves correct.
CCC 382.2p + 3.33% is my best-performing share today. I bought these in late-July at 346p. Not a bad choice so far. I was attracted by the director purchase, 4%+ yield, and PFCF<10. Margins are pretty thin, mind, so it’s not an outstanding company. Adjusted EPS is just under a whisker of doubling in a decade. Its EPS did stumble once, in 2005, going down 55.5%. Analysts expect EPS to rise 15.4% for 2013. The shares were marked down yesterday in anticipation of IMS today. In early morning trading, shares stumbled further, but closed +3.3%. The interim report is pretty much in line with what most people expected. Revenues are up 4.2% against comparables, but the thing that it looks like the market has been disliking for awhile is the idea of a reduced EPS. EPS is in fact down. Interim dividend has increased by 11.1%, showing confidence in the future. The company has plenty of cash. The company reported double-digit organic revenue growth in Services. The company looks good value.
SGP 480.00p -3.42% is my worst-performing share today. I bought these in late July at 437p. No news, it just looks like the company is taking a breather. The investment theory – and people no doubt think I’m mad – is that SGP was fairly cheap on fundamentals when I bought it, it is still in a growth phase, and they’ve got bought new management on board. Presumably the new batch will know how to work their calculators a bit better.