I wrote about VST a month back and got it perfectly wrong. The company has come out with a 60%+ topline growth and doubling of bottom line. I have not been find more details on the results, but need to figure out how the company has been able to increase topline so rapidly in a business with such a low growth.
The company reported a 10% topline growth and a flat bottom line. The bottom line is flat due to the 20% rise in the rail expenses. Although I don’t have the exact details, the rail charge hikes cannot be passed on the customers immediately and there is a lag in getting the price increase.
The overall results are good in view of the slowdown in the exim markets. Concor has been a long term holding for me and is a very profitable logistics company with a cash rich balance sheet, attractive margins and substantial competitive advantage.
I wrote on Novartis earlier here. I have not completely exited the stock as I felt the buyback price was too low. The company has been able to increase the holding to 76.4% now. The company increased the topline by 7% and bottom line by around the same amount.
The performance is nothing out of the ordinary. The stock continues to be undervalued and will most likely remain so. The only upside is a possible buyback and delisting by the parent. However as there is no fixed timetable, it may not make sense to hold the stock for the long term. In my case, I will exit my position when I can find a better idea.
So how is your portfolio doing ?
I often get this question by email. The short answer is – as expected (around 10% in excess of the index returns). I started buying last year from march and went all in by Q4 of 2008. I have not been very active since the beginning of the year due to various reasons ranging from shortage of cash to lack of time.
I have been lucky that my wins generally end up more than compensating for my goof-ups. It is however difficult to know beforehand which idea would be a winner or a clunker. In the final analysis, though it is the portfolio performance rather than individual stock performance, which matters more.