Seven winners this past week ! Out of these, 3 were opened and closed in the same week and the rest I owned since earlier in 2020.
The top 3 winners where $CSX with a 10% gain in 5 days, $VIAV with a 5.01% gain in 2 weeks and $RR.L with a 4.90% gain in one day. While the future remains uncertain for Rolls Royce, I will look for opportunities to go back into CSX Transportation in the near future; also we still hold a 2% position on Viavi Solutions.
This week we have also gone back into Coca Cola (ticker: $KO ) which is a long term investment. The stock has dropped a lot and seems to have now stabilised with a potential breakout in sight. The dividend yield is 3.6% at these valuations and the stock goes ex-dividend early in June.
Aroundtown (ticker: $AT1.DE ) has been badly hit during this corona virus crisis, just like most of the real estate companies. We have previously invested in $AT1.DE and made a decent profit out of it. As the sector stabilises, it seems a good moment to go back in as it offers capital appreciation potential and sports a 5.2% dividend.
Just as the sentiment was turning on Thursday, I added to my $SQQQ position which played out really well as a hedge: the US markets were down between 2.5 and 3.2% on Friday, whereas my eToro portfolio was only down 0.39%. This highlights the importance of having hedges in times of volatility as the market can quickly change its course.
At this time, I am 58% in cash and have 5% in hedges (inverse ETF): if you don’t have enough cash, you won’t be able to take advantage of bargain stocks that will come your way in the future.
If you want to find out about all the positions in my eToro portfolio follow this link.
Verizon (ticker: $VZ ) has been a great investment for me so far, I have owned it for about 2 years now. It is one of the value stocks which offers both a solid dividend (>4%) and capital appreciation.
It is considered a 5G play and its deal with $DIS related to Disney+ has helped it soar.
Verizon is a mega cap, with a market value of 240B $. It currently trades at 58.13$ and it was trading at about 48$ when I bought it. This means a 20+% capital appreciation which outperformed the SP500 by 15 percentage points over the same period. And then you have to add the dividend, which was about 5% at the start of my investment and is now 4.28%. American stocks typically pay dividends out on a quarterly basis which gives you the option of re-investing more frequently than, say, most European stocks which pay a dividend on a yearly basis.
In terms of valuation, the stock is actually quite pricey at the moment and the projected total return over the next 5 years, including dividend, is of 41%. There are plenty of better valued stocks out there which offer a greater growth potential (even >100%), like $AMZN and $TSLA, but you probably want to combine more aggressive plays with other less volatile investments in order to stabilise your portfolio. In 2008, when the market was down 38.5%, Verizon was “only” down 21%. So far in 2020 Verizon is down 7% compared to a 15% fall of the SP500.
The stock has had a steep recover from the late March lows and is now trading above the 5 and the 50 moving average, with the 200 moving average within grasp.
It reports earnings for Q1 of 2020 on Friday the 24th of April. Consensus estimates are EPS of $1.22 and revenue of $32.37B.
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