August 2016 - Quarterly Review

It's time to check out how the May2014, May2015 and May2016 portfolios are doing.

May 2014

The overall return of the M2014 portfolio is just under 8%, averaging about 4% per year.  Losing stocks are WFT, LNR, STN and EQB.  GIB.A two year return is 73%, nice. GC and GIL round out the other winners with 42% and 33% gains respectively.

This is the performance graph since inception.  2016 is on track to be a tepid year for this portfolio.

The M2014 portfolio performance graph above as compared to the Toronto Stock Exchange for the same period. According to Google Finance, the portfolio is doing 10% better than the TSX, which has been essentially flat for the past two years.

May 2015

DH continues to struggle with it's stock now down 28%, but thankfully ATD.B is up 40% in our M2015 portfolio.  EMA and WPK are giving decent double digit returns for the year.  T, NA and SJ are more or less even.  The return for this portfolio after 15 months is 5%, which is just OK.

M2015 portfolio performance graph will hopefully continue it's upward movement.

It's interesting to point out that the M2015 to TSX performance differential of about 10% is about the same as the M2014 vs. TSX.  Different timeframes (2 years vs 1 year) , but same relative performance.   You can see that the TSX was down close to 20% this past winter, but has now recouped it's losses.

May 2016

The newest portfolio is now showing a 7% return after 3 months.  The dividends returned is about 1% this quarter, so we are on track for a 4% overall dividend yield.  So far, no losers in this basket, but the last minute pick of NWC is just treading water right now.  The rest of the stocks are doing well, so I'm hoping it will continue it's performance into next year.

Overall the performance graph of the M2016 portfolio looks great, but it looks like it's due for a downturn in the next few months.

Since May of this year, the TSX has increased by about 5% and the M2016 portfolio is doing just a bit better at 7%.

NWC vs. ET

If you read my previous post, you'll know I originally had Evertz Technology ET in the M2016 portfolio and then I replaced it with NWC.  Comparing the performance of the both stocks reveal that they both kinda suck, although ET did move up 8% in the month of June only to give it all back later.

So I went back and reviewed the 5 year stats for ET and it's showing 45% return. Did I look at the wrong graph back in May 2016 because I thought it had a much weaker 5 year return?

Here's the 5 year return graph for NWC, also showing a return of 45% over 5 years.   Heh, these two stocks are almost identical in performance and fundamentals.

And here's a poo emoji, just because.

Well, that's it for August 2016.  See you in November 2016 for another update.  Thanks for looking.

May 2016 - New Portfolio

Welcome.  

It's time to pick some new stocks for our new May 2016 Portfolio.  If you are interested in the most current returns and performance of previous years portfolio selections, see the previous two blog posts.

Last minute chgs: see end of blog post for details.

Stock Criteria

This year I wanted to focus on smaller cap stocks that have a dividend yield of around 4%.  Here are the stocks I have selected that satisfy the criteria.

Current stock prices are between 10 and 20 dollars per share approx.

Market capitalization is between 1 and 4 billion dollars.

Stock Selections

In keeping with our past theme of 7 stocks and as much diversification as possible, here are the picks.
The initial portfolio value is about $35,000, with each stock purchase worth about $5000.  Overall portfolio dividend yield target is above 4%.

AQN div yield: 4.77%, 5 yr return:  96%

CRT.UN div yield: 4.57%, 5 yr return: 47%

ECI div yield: 5.71%, 5 yr return: 114%

ET div yield: 4.24%, 5 yr return: 3%

FCR div yield: 4.11%, 5 yr return: 25%

ITP div yield: 3.42%, 5 yr return: 1165%, yes you read that right.

RNW div yield: 6.87, 5 yr return: 28%

Stock Historical Performance

In April of this year, I started doing my research and modelled this portfolio as if I had bought the stocks in the preceding year.  If I had picked these stocks last year, the portfolio would have a return of over 10%, which is much better than the current stock returns of the May 2015 portfolio.  The dividends alone on this portfolio amounted to $1500 in one year.

Pictured above is the one year performance graph of the May 2016 portfolio, May 2015 thru May 2016.  

May 2016 Portfolio

Ok, so I've reset the portfolio dates to commence on Fri, May 20, 2016, with the stock prices reflecting their end of day values.  Commissions are factored in, assuming $10 per trade.  Initial portfolio value is approx $35K.  Let's see where this one goes, hopefully I can do better with the stock picks than my past two portfolios.  Will revisit this and the other portfolios in 3 months time.

Last minute Update

So I was just checking the 5 year returns of the stocks and noticed that Evertz Technologies hasn't done that well at just 3% overall return.  Hmm.

I think I will swap it out for NWC instead.  It's got a 5 yr return of 45% and it's div yield matches our critera of 4.26%.

So the new portfolio looks like this:

http://www3.nhk.or.jp/nhkworld/en/vod/facetoface/20160522.html

May 2015 Portfolio Update as of May 17, 2016 2.5%

Ok, so we just looked at the poor performance of the May 2014 portfolio with it's one year loss of 16%.   And for the first time, it underperformed the TSX.   Now, let's see if the May 2015 portfolio fared any better.

And we see that the one year return of the May 2015 portfolio is about 2.5%.  That's about 2% more than what the banks will give you on a GIC currently.   This portfolio has not been immune to the stock market woes of late.

We are just a few weeks shy of the one year anniversary for the May 2015 portfolio.  A look at it's performance as compared to the TSX, shows us that the portfolio is doing better by about 15% over the past year.  Good news, that.

We again have a mix of crappy performing stocks and better ones.  So my stock picking skills still need improvement.  Let's look at the stocks.

DH Corp (DH) used to be one of the best performing stocks in this portfolio but it has recently been targeted by short sellers.  It is now down 15%, since portfolio inception.   Motley Fool thinks it's a good buy for patient investors (like us!).

http://www.fool.ca/2015/10/30/down-over-10-this-month-dh-corp-could-be-a-screaming-buy/

National Bank (NA) hasn't done well at all in this portfolio and is now down 14%.  I thought that it would have had a better return than the big banks, but I was wrong.   Really wrong.  The peer comparison graph and one year returns says it all.  However,  Motley Fool says now is a good time to buy NA.

http://www.fool.ca/2016/05/09/national-bank-of-canada-a-contrarian-bet-on-canadas-economic-recovery/

Telus is the other laggard in our May 2015 portfolio.  If it wasn't for it's stellar dividend yield, this stock return would be much lower.  It's down 2.5% on the year.  Motley Fool says Telus or Bell (BCE) are good to have in one's portfolio.

http://www.fool.ca/2016/05/11/should-you-buy-bce-inc-or-telus-corporation-today/

Stella Jones (SJ) has done alright in 2016.  It's up 5% over the past year.  What's confusing to me is why this stock is doing so much better than West Fraser Timber (WFT) during the same timeframe.  Both stocks are in the Forestry sector, so the poor US lumber prices that impacted WFT should also have affected SJ?  I guess I have to do some more research on these two companies and find out what's different about them.  Motley Fool says SJ is more influenced by the oil industry than being a wood producer, and thinks it's time has come and gone.

http://www.fool.ca/2016/01/15/stella-jones-inc-shares-have-returned-1000-over-10-years-can-the-run-continue/

We have way more winners than losers in the May 2015 portfolio vs. May 2014 portfolio.  Emera (EMA ) is one of the winners with a 12% return during the past year.  Dividend yield is good too.

Motley Fool says that either EMA or FTS should be in your portfolio.

http://www.fool.ca/2016/05/16/is-fortis-inc-or-emera-inc-the-better-buy-today/

ATD.B has given us a 15% return in the past year, but in the last couple of months it has lost steam.  Not sure if it's good performance will continue into the coming year.  Motley Fool says it's a good buy between $45-$52 dollars per share.

http://www.fool.ca/2016/04/20/can-alimentation-couche-tard-inc-rise-another-800/

The best one year return of this portfolio belongs to Winpak (WPK) at 18%.  Chart shows that it continues to look strong.  Here's what Motley Fool says:

http://www.fool.ca/2016/03/08/winpak-ltd-the-steady-consistent-performer/


Will check back in, around the end of August.