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StockTalk
StockTalk

Season 1, Episode 9 · 1 year ago

Core / satellite portfolio . Skyworks and intact financials

ABOUT THIS EPISODE

The episode covers concepts of core and satellite portfolio . Its also covers stocks - #skyworks solutions and Intact Financial corporation .

Good evening, everyone and welcome totraase podcast. Today we are going to discuss what things to look at. Whileyou are investing it's a very volatile time right now, market went up the lastweek. It is gone, it mins. It was flag the other day. Today it went down sothe voltality is very high. So what thinks to focus on looking at theeconomic environment, with the corona virus, going on with the oil wars goingon and potential slowdown Amens, not potential, it's actually a slowdown inconsumer spending, an income in everything. So what things to look atwhile investing once again, this is an educationpodcast. This does not in any way mean any investment advice, so be aware ofthat. So today's market overview SR TX...

...was down today around three three: Aand a half percent, a it five hundred four plus percent down Lou Jonesfullpup, four plus percent down NASDAR PAS around four percent down again overfour percent down and volatility was up. So volitalit is the fear index. So fearindex was up around fifty. So a lot of people have been asking me like marketwere going up based on the stimulus package, so is the worst over, so Idon't believe the worst is over, because I watch voletality a lot. Iwatch the fear index a lot. The moment fear index goes down below twenty, thenI think worst would be over, but right now the voletility is just too high, so we are going to discuss about how toapproach your investments, so I generally follow a concept ofcorpotfolio and satellite put for you.

So what is a court pot? Folio CourPotfolio for me is sixty to seventy percent of my stockholdings. So let'ssay my stock holdings have currently hundred thousand dollars so out ofthose hundred thousand dollars sixty to seventy percent I put in mycourtpotfolio. So what is a courtportfolio? For me, Co putfolio forme is a diversified portfolio which I generally include, which I generallycreate using exchange. TUDED funds, I'm not a big Fan of mutual funds, becauseI believe the expense ratioes are too high there. So I personally invest in alot of exceene streated funds and once again Inyo my cortport folio. I do notlook at Nase or industry wise Exchane, tridit funes. I look at broad excenestridit frands, so they may be following Tsx t six, sixty five hundredor SP FI anded. I personally love Isspe...

Fieandet for getting my corpot full Yogoing so sixty to seventy percent of my holdings are in Cortpotfolio, and this is where I put my regularInvestmensan so each month, based on valuations, I change it a bit, but eachmonth I put some money towards my corportfolio and if I'm not finding any company atmy value at the value that I am looking for, I invest in the courtportfolio. Soall these days, when the markets were sturbulent, it was going up going down.I was investing bits and pieces in my corportfolio, then apart from cortportfolio, that issixty to seventy percent of my holenans. I also have a satellite Pud folio,where I generally take a risk, and this is where I tri to beat the overallmarket, so satellite poult Fullio is thirty to forty percent of my holdingso considering an hundred thousand dollar putfolio that I have. It isthirty to forty thousand dollars of...

...satellite holdings now satelliteholdings. I keep it non diversified, so I do not invest in ets. I generallyinvest in sectors or in specific stocks, so individual stocks, our specificsectors. I try to create it's a very good approach to do. It bid a corportfolio that is sixty to seventy percent of your stock investments, and then you takerisk on thirty to forty percent of potfolio, so it may be thematic like, Ibelieve, a lot in gaming. So I hold some gaming ets or I believe inagriculture is not going to go away, so I have some agriculturetf topharmaceutickers, so I had have some thematic investments there and I alsohave all my stock individual stock investment part of my satelliteportfolio. So today we are going to talk about two companies that I'm veryinterested in in, and I've been a hawk watching these two companies veryclosely: the First Company skywork...

...solutions, it's a wirelesssemiconductor company that designs and manufactures redio frequency andcomplete semiconductor systems. So what do they do? They create silicon chefsthat go into most of the mobile phones, so any mobile phone that you use apple,Samson, wavy, HTC, Zetty. Most of them have skyward solutions chips, so eachtime of one is sold. They get a penny out of it, so they every dollar thatthe apple or Samson get sold. They get somerevenue out of that about. Fifty percent of company sales are out of USand fifty percent sale a arn us, so they have a wide global presence. Now what has happened to this stockskyvars solutions? It's an excellent stock fig playe, because fiveg willhave everything is going to have chips going forward. Your toaster is going tobe smart. Your refrigerator is going to...

...be smart, then connected to theInternet. Your dor well is going to be smart connected to Internet, so everyiote device, every Internet of thing device would someway connect to theInternet. That would be a big big big game, changer for skyward solutions, sovery high growth potential, and I love that now what has happened to ith stock?It is thirty five percent down since it stop excellent free cash flow, socompany actually makes money and that's what it's very good about it. Jos,seven dollars. Eighty eight cents of CASTFLOW DIVIDENDER: It pays dividentof Rund, two point: one five percent and the best part about is dividend.Growth rate for the last five years averages twenty nine percent. So everyyear the dividends are growing, but thirty percent. So if you gettwodollars and fifteen cents right now,...

...next year, youare going to get thirtypercent more in terms of dividence, and I love that earnings for share positiveand five dollar thirty eight cents now this is this- is lovely about thiscompany and in this tiring times the debt to equity ratio and debt to acidratio. This company has very good balance. seet and low amounts of debtnot deat kills, as we have talked a million times right now. Debt killswhen the Times are tough, but this company doesn't carry much dat. Sothat's an amazing positive for this company P Racio is around fifteenlewest. It has ever been, is around seven, so average pcs around seven, itis traiding around average, so Louis ite is around seven return on equity,twenty percent, that's fabulous, so writurn of equity, more than tenpercent in long UN, generates a lot of money for you institutional ownership.Now this is an bit of an issue. That's...

...why the stock becomes maller time.Large institutions hold ninety five percent of this stock. Only fivepercent of the stock is avalable to reatmensits whole by retail investors,so the price change becomes huge if institutional ownership is large, thebyand cell orders are large. So that's why the stor becomes more voletile, butI don't mind that in such a good investment and I'm looking at a prize of seventydollars anythingbelow seventy year, stealing money from the market five ten years Internet ofthings is happening five, ten years, anything below seventy lite- that isthirteenp, just stealing money from the market. So this is the price I'm looking at forskywork solutions. Seventy and below that gives it a p of thirteen and, Ibelieve, like even fifteen, ps reasonable, but thirteen pees likeyou're stealing money from the market...

...in the long rum, so skywordh was an American company. Weare also going to talk today about a Canadian company. It's listed on tsxcalled US intact financial corporations, which provides property and casualtyinsurance in Canada. The company's business is organized in personal andcommercial product line, it's active in Canada and US providing automobileproperty, liablity insurance to booth individuals as well as mall and midsizeclients. So what's good about this mince macrokvice, so we are not driving our vehicle, so everyone is at home, so the amountof accidents are going to go down. Sothat's a big positive for insurance players that neof set some form of dropand revenues through lower premiums. So that's again a good sign for thiscompany. Now stockwise it hasn't...

...dropped much. So it is twenty fivepercent down since its stop free castflow. The company generates a lotof free cash, Aon nine point to five dollars. DIVIDENTY is two point: Eightpercent dividend growth every year for last five years: Averageis ten percent.So each year the dividend is growing. That's an fabulous sign, EP surning pershare of the companies around four point: fivedollars positive growingeach year. thes revenues are up. The earning at up. The EPS are up so goodvalue in that deat to equity, thirty, seven percent for an insurance player.That's reasonable debt to asset nine percent. That's amazing! For a company,so noer spectrum of debt, not very high debt, P ratio. The average for thiscompanyes has been around twenty Lewes it has ever been is around eight returnon et is around ten percent institutional ownership. Forty sevenpercent that makes it quite stable, so...

...majority. Fifty three percent of thestock is holed by retail investors rather than institutionals, and insideEr bye buying has increased in last six months. It has not increased by matchby around zero point one six percent putence insiders are buying into thiscompany. That's always a positive sign for this company. I look at P and Iconsider anything below twenty should be good right now. It is not trading attwenty, so the prize that it comes to his around ninety. So if this companygoes to ninety or below, I may look at buying some of this stock. It has goodbrand name in the market, so it Hait is like high amount of history behind it.It was listed in nineeen hundred. It has been doing business for all thoseyears, good bal, decent balanceat, some form of debt, but that's okay for aninsurance business right. Some macros...

...are in favor, like people not driving,pulls down the insurance claims, but there would be lost in revenue loss inpremiums to so it's a pull and push game, but maybe some drop in revenue,but not significant and historically it has grown itrevenue each time. So in that financials looks to be an okay stokbelow ninety. For me, and skywork solution looks to be an excellent Stogbilow. Seventy, so thank you for listening Hame, an IC Stein, see you inthe next podcast.

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