Portfolio Bargain Hunting

Portfolio / Investing Jun 25, 2006 - 07:15 PM GMT

The portfolio was expected to decline a little given the drop in the market during May / June 06, but two stocks going strongly against the grain result an overall gain - TATE up some 40p to £5.93 and Enodis the speculative pick up over 60p !!! at £2.11 Dividends - Rolled in this month totaling £205.39 !, with LLOYS topped the list paying at a whopping £117 !, then came BATS at £66, hmmm BATS, I am starting to think it may have been a mistake to liquidate BATS in April, luckily the price is a little lower now, so it may be worth recommitting for the long-run !

For this portfolio update I will look at what to do with some of the £11k in cash, time to go looking for some cheap stocks, I would love to add to it the United Utilities holding but this is already the largest single investment, as well as wanting to take a closer look at why Enodis rallied so much.

How to I Select the Stocks ?
You may wonder ?, I primarily use the stock selector at digitallook.com, which offers some 40 variables ranging from EPS growth, Peg Ratio, dividend cover etc. I run the selector on the FTSE100 and FTSE250, using a range of variables that I adjust from time to time, to output some 20 stocks. I then analyse these individually, which includes looking at the financial reports, and technical analysis of the charts and whittle these down to a handful that I track for an opportunity to add to the portfolio when the opportunity arises. If you want to select your own stocks then I highly recommend the Stocks Screener at digitallook.com (MarketOracle.co.uk is NOT affiliated to digitallook).

ENODIS - The recent surge in price has been amazing, searching through news reveals the following - Last month, the board of Enodis rejected Middleby's 195p-a-share offer, which valued the company at £796m. So its had an offer, and rejected it. I think that for the foreseeable future the upside looks limited, yes they could up the offer to maybe £2.30, or withdraw the offer, or a rival bidder could emerge, but at £2.10 the stock looks a tempting sell, and there is no other reason to hold it short-term, maybe if the offer is withdrawn and ENODIS falls back below £1.50 we can look at it again, but for now its time to take profits on this speculative stocks that's paid out !

BATS - Consistent share price trend, earnings growth and dividends !, what more could someone ask from a company ?, Okay so cigarettes are not exactly an ethical, but that's now what this portfolio is about, so buying at slightly lower prices BATS again, same holding as before i.e. 200 shares for the long term growth and income

CENTRICA - This highly profitable energy company that supplies most of the gas to british households as well as electricity to over 5 million households in the UK. Having come off of recent highs above £3, the current price gives a good opportunity to enter. There have been bid rumours circling around Centrica for over 6months, but that's a bonus if it happens, the key is good dividend of over 4%, solid earnings growth, and the company is immune to any economic slowdown and thus a good long-term investment for our 'safe' portfolio, My only regret is that I missed buying it last October.

HBOS - Playing safe again by picking one of the UK's largest high street banks. The price has shown stability during the recent market downturn, which suggests strength, and therefore a good long-term pick. Dividends are about 4% with earnings growth of 5% likely. downside looks limited with good steady growth and income expected.

I was going to pick a mining stock as a speculative play, bit the volatility is a little high so we will see what happens over the coming months.

25-Jun	Market Oracles Stock Portfolio
	Stock	Ticker	Date buy	Price paid	Quantity	Total Book Cost	Cur Price	Dividends	Cur Value	Val+Divs	Gain/Loss	% Gain/Loss
	United Utilities	UU	28/10/2005	£6.12	500	£3,087	£6.56	£71	£3,280	£3,351	£264	8.6%
	British Telecom	BT.A	28/10/2005	£2.07	1000	£2,092	£2.29	£43	£2,285	£2,328	£236	11.3%
	Lloyds TSB	LLOY	28/10/2005	£4.49	500	£2,268	£5.21	£118	£2,605	£2,723	£455	20.0%
	Tate & Lyle	TATE	28/10/2005	£4.53	500	£2,288	£5.93	£30	£2,965	£2,995	£707	30.9%
	British American Tobacco	BATS	23/06/2006	£13.58	200	£2,742	£13.58	£0	£2,716	£2,716	-£26	-0.9%
	Centrica	CAN	23/06/2006	£2.74	900	£2,490	£2.74	£0	£2,466	£2,466	-£24	-1.0%
	HBOS	HBOS	23/06/2006	£9.31	250	£2,351	£9.31	£0	£2,328	£2,328	-£24	-1.0%

	Cash									£4,985

	Totals			Original capital (28/10/05)		£20,000				£23,891	£3,891	19.5%
	FTSE 100		23/06/2006				£5,692

	% Change		6 months	1 year	2 year	3 years
	Portfolio change		19.5%
	FTSE 100		1%
	Difference		18%	0%	0%	0%
	(closest portfolio update to the period)
	Charges deducted todate (£12 to buy / sell & 0.5% stamp duty on purchases)									-£330
	Dividend income received to date									£406

Portfolio Transactions this period (since last update)
Date	Type	Stock	Qty	Price	Charges	Amnt £
	Dividends	BATS	200	£0.330	£0.00	£66.00
	Dividends	LLOY	500	£0.235	£0.00	£117.50
	Dividends	Enodis	800	£0.008	£0.00	£6.64
	Dividends	BP	300	£0.053	£0.00	£15.75
23/06/2006	BUY	British American Tobacco	200	£13.58	£25.58	-£2,742
23/06/2006	SELL	ENODIS	800	£2.11	£12.00	£1,676
23/06/2006	BUY	Centrica	900	£2.74	£24.33	-£2,490
23/06/2006	BUY	HBOS	250	£9.31	£23.64	-£2,351

(c) MarketOracle.co.uk 2005-2006

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