Responsible Investor Portfolio Weekly Update, November 28th, 2020 | $TCEHY $NEM $BK $SYF $CLIX $GRUB $PCG $LVMUY $LRLCY $PEUGF $IMPJY $TERRF $DSV.CO $DANSKE.CO $BRK $UMC $JD $ADSK $GMAB $DVA $ROKU $GOOG

The Big Picture

On the US presidential election front, Trump finally gave the green light for an orderly transition and there are now signals of him getting closer to conceding: however remote the possibility of surprises in the transition process was, this is good news for the US markets. President-elect Biden announced some of the prospective cabinet members as well as his pick for the US Treasury, the well-known and respected Janet Yellen; this is another good news, first of all because it would be the first woman to cover that role and secondly because she is known to be lenient towards QE.

Market Performance

All the indices we track were higher this week, especially European stock markets which benefitted from an additional trading day as the US celebrated Thanksgiving on Thursday. In the US, the Nasdaq was up 3% whereas the Dow and the S&P500 gained 2.2 and 2.3%, respectively. The Energy sector led for the second consecutive week. European stock markets went higher, with the Stoxx index gaining 1%, the Italian FTSEMIB ripping 3% and the Danish OMX20 finishing flat. With just one trading day to go, this November could be the best in the stock market history.

Earnings

The Q3 earnings season is now over. In the S&P500, 84% of the companies beat earnings; however, there was a 6.6% decline in earnings overall this quarter. Healthcare was the best sector with a 13% earnings growth. Check out this cool infographic by Factset for more.

With last week’s 5% increase, our $SYF position is now 43% since we bought it 6 months ago. One of our most recent buys, $UMC, which is an investment in the semiconductor sector, jumped 20% this week following news of capacity increase of their production facilities. It is also worth noting the 7% weekly gain of $ADSK which is up 11% since our purchase 2 weeks ago, with the recent boost triggered by their earnings beat on Tuesday.

Dividends

This week $TRN.MI went ex-dividend and paid a 4.3% dividend bringing the performance in our portfolio to about 9.1% which is very good considering the defensive nature of TSO companies. Three more stocks of our portfolio go ex-dividend in December.

Portfolio Performance

Our Responsible Investor portfolio is now up 13% (14% including dividends) in 6 and half months. We are about 55% in stocks & ETFs and 45% cash. On my watchlist this week I have $DVA, $ROKU and $GOOG.

The table below summarises the portfolio performance since inception.

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 35+ positions and can be accessed via this link.

Responsible Investor Portfolio Weekly Update, November 21th, 2020 | $TCEHY $NEM $BK $SYF $CLIX $GRUB $PCG $LVMUY $LRLCY $PEUGF $IMPJY $TERRF $DSV.CO $DANSKE.CO $BRK $UMC $JD $ADSK $GMAB $DVA $BYDDF $GOOG $AZN

More positive vaccine news came in this week with Moderna ($MRNA) announcing that their vaccine is 95% effective and requires much higher storage temperatures than Pfizer’s thereby simplifying logistics, Pfizer ($PFE) upping the effectiveness of their vaccine to 95% and Astrazeneca ($AZN) reporting that their vaccine produces a strong immune response in older adults. These news pushed the markets higher in the first half of the week. Thursday and Friday wiped off the earlier gains as other news dominated the narrative about Covid-19 numbers, including New York closing its schools, and further delays in the start of the orderly transition of powers to the next US President.

All of the above resulted in a mixed bag in terms of stock market indices performance. In the US, the Nasdaq was the only index delivering a nominal gain of 0.2% whereas the Dow and the S&P500 were down 0.7% and 0.8%, respectively. The Energy sector was the leading one this week. European stock market indices generally delivered a weekly gain as the Stoxx index rose 0.9%, the Italian FTSEMIB was up a 3.6% and the Danish OMX20 finished 1.5% higher.

The biggest winners of our Responsible Investor portfolio were $PCG and $WBD.MI. Our two positions in the Californian energy company are now up 20 and 25% respectively. The Italian-based contractor has delivered its third consecutive weekly double-digit gain.

We added our first drug stock this week, $GMAB.CO, which is already up 2.7%. The company is headquartered in Denmark but is also traded in the US stock market (ticker: $GMAB). Genmab is grossly undervalued based on future earnings estimates and has an outstanding track record having delivered a 40% annual capital appreciation to its shareholders over the last 10 years. It is a pure growth stock hence it does not pay a dividend.

Next week $TRN.MI goes ex-dividend. Italy’s TSO has a 4.1% annual dividend yield. Three more stocks of our portfolio go ex-dividend in December. $ADSK will release their earnings on Tuesday.

Our Responsible Investor portfolio is now up 10.8% (11.5% including dividends) in just over 6 months. We are about 54% in stocks & ETFs and 46% cash. On my watchlist this week I have $AZN, $DVA, and $GOOG.

The table below summarises the portfolio performance since inception.

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 35+ positions and can be accessed via this link.

Responsible Investor Portfolio Weekly Update, November 14th, 2020 | $TCEHY $NEM $BK $SYF $CLIX $GRUB $PCG $LVMUY $LRLCY $PEUGF $IMPJY $TERRF $DSV.CO $DANSKE.CO $BRK $UMC $JD $ADSK $DVA $BYDDF $GOOG

It didn’t take more than just a few hours after our last weekly update was published for the news that Biden was confirmed to be 46th president to be broken last Saturday afternoon. Yesterday that outcome was further confirmed by the “final” results from a few states where the race was very close. The formal recognisition by China was an equally important milestone achieved by Biden, especially considering that Trump has still not conceded. It wasn’t the US presidential election to dominate the news and the market this week though. Attention swiftly shifted back to the pandemic but the concerning increase of Covid-19 cases was eased by the biggest story of the week: Pfizer’s announcement of their allegedly 90% effective vaccine. That day a massive rotation was observed from the so-called working from home stocks to those that have been badly hit by the pandemic.

Value outperformed growth this week as demonstrated by the Dow being up 4.1% while the S&P500 grew by 2.2% and the Nasdaq finished 0.6% negative. This side of the Pond, the Stoxx index was up 5.4%, the Italian FTSEMIB yielded a 6.4% weekly gain while the Danish stock market lagged and finished 1.8% lower. Our Responsible Investor portfolio was up 3.3%, with six of our positions gaining more than 10%.

$BRK released their earnings last Saturday. The main takeaway is that they bought back 9B $ worth of shares in Q3. Typically, companies implement buybacks as doing so reduces the number of shares outstanding, thereby inflating earnings per share and, often, the value of the stock. Berkshire must have thought that there was nothing else worth buying this quarter. $TRN.MI ‘s earnings were positive and the company will announce their 2021-2025 business plan on November 19th.

We added another technology stock this week, $ADSK, which is already up 2.4% in just two days. I have always admired the ability of this company to innovate as well as their earnings growth rate: their projected annual earnings growth for the next 5 years is 35% which is almost equal to the annual appreciation they have delivered over the past 5 years. To put things in perspective, with such a growth rate the stock could double in just over 2 years.

$SYF and $BK paid their quarterly dividend this week. Our Responsible Investor portfolio is now up 9.7% (10.4% including dividends) over its first 6 months. On my watchlist this week I have $GOOG and $CMG.

The table below summarises the portfolio performance since inception.

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 35+ positions and can be accessed via this link.

Responsible Investor Portfolio Weekly Update, November 7th, 2020 | $TCEHY $NEM $BK $SYF $CLIX $GRUB $PCG $LVMUY $LRLCY $PEUGF $IMPJY $TERRF $DSV.CO $DANSKE.CO $BRK $UMC $JD $GOOG $ADSK $BYDDF

The US presidential election dominated the news cycles this week and still does. The global stock markets have welcomed the results that have been made available thus far and delivered a massive rally which offset last week´s steep decline. As the US get closer to finding out who their 46th president will be, there will soon be one less uncertainty to factor in the risk for.

Another piece of news which provided further tailwind to the US stock markets is the unemployment report that was published on Thursday and exceeded expectations highlighting the unemployment rate drop below 7%. The continuous outpour of increasing Covid-19 cases has been completely obfuscated by the US presidential election this week but this may change in the coming days as attention returns to coping with the pandemic.

The Stoxx index was up 5.4%, the Danish stock market grew by 6.4% and the Italian FTSEMIB closed with a 7.4% weekly gain. In the US the Nasdaq was up 8.9%, the S&P500 gained 7.3% and the Dow finished 6.8% higher. Our Responsible Investor portfolio was up 6.9%, broadly in line with the global markets. Three of our positions gained more than 10%, one of them is our recent buy, Chinese e-commerce stock $JD which finished 13.5% higher this week. On the currency front, the USD weakened relative to the EUR. This also bumped up gold as well as our mining stock $NEM.

The earnings season continues as companies keep beating estimates and guiding higher, on average. $DANSKE.CO reported earnings this week and benefitted from an upgrade by Morgan Stanley who increased their TP to 101kr per share while the stock is currently priced at 90kr. $BRK´s earnings are due today. Next week two of our Italian stocks will report earnings, $TRN.MI and $RWAY.MI.

Quarterly dividends are due for payment this week for two of our financial stocks, namely $SYF and $BK. We report on both capital appreciation and dividend yield so as to track total return for our positions.

The table below summarises the portfolio performance since inception.

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 35+ positions and can be accessed via this link.

Responsible Investor Portfolio Weekly Update, October 31st, 2020 | $TCEHY $NEM $BK $SYF $CLIX $GRUB $PCG $LVMUY $LRLCY $PEUGF $WBD.MI $DSV.CO $DANSKE.CO $BRK $UMC $JD $GOOG $ADSK $BYDDF

It was a horrible week for the stock markets, the worst since March actually, with most indices suffering from more than 5% losses. The main concern continues to be the second wave of the pandemic which is inducing several governments to impose new lockdowns, however ‘soft’. The upcoming US presidential election is another cause of uncertainty as demonstrated by increased volatility levels: even though this coming Tuesday is election day, considering that many votes have been cast by mail, it is likely that the winner won’t be known until week after next or even beyond that. There is an unmissable Netflix special on US voting rights which is free to watch on Youtube.

Going back to last week, out of the markets we watch more closely, only Denmark had a more muted response and was only down 3.1% while the Stoxx was 5.4% lower and the Italian FTSEMIB suffered a 6.6% loss. In the US the Nasdaq was down 5.4%, the S&P500 5.6% and the Dow 6.4%. Here is an interesting video with a summary of the technical analysis for the US stock market: while valuation is the main ingredient in investing, momentum should not be ignored. Our Responsible Investor portfolio was down 3.9% which means that we have beat the market by 2%. Yesterday was the last trading day of October, which finished lower for most indices.

It was a big week for Q3 earnings with tech giants like $AMZN, $FB, $AAPL and $GOOG reporting on Thursday. Amazon had by far the most impressive top and bottom line numbers, while Apple somewhat disappointed. $TWTR dropped 21% the day after their earnings report came out: looks like an overreaction to me but I would not touch it until one of the two US president candidates concedes.

$NEM beat earnings doubling their profit yoy for what was their best quarter ever: the stock has had a good week compared to the various indices as investors turned to gold and I still consider it grossly undervalued based on the earnings growth projections.

$GRUB smashed their earnings on Wednesday. Their sales were up 54% yoy but the stock was down last week and followed the mainstream trend. The stock is poised for more growth based on estimates but it will be important to see whether momentum will be on its side too otherwise we will lock in our profits, pull the plug and put our money to work elsewhere.

$PCG missed on the bottom line while they matched revenue expectations: I will review our position and send an alert if I feel we need to act on our position. Finally $DSV.CO reported an earnings beat and finished the week with a 0.3% gain; they have also guided higher in terms of EBIT margin. Next week $DANSKE.CO and $BRK will report earnings.

We have made two buys on Thursday: $UMC, our first semiconductor play and $JD, a Chinese consumer mega-cap stock. I think they have a long way to go given their current a projected valuations but only time will tell!

The table below summarises the portfolio performance since inception.

If you don’t want to miss my alerts, please subscribe to Responsible Investor or follow me on Twitter. I also run an eToro portfolio which currently has 35+ positions and can be accessed via this link.