Twelve weeks in, how is our portfolio looking?
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It's been twelve weeks since our Beginners' Portfolio made its first investment, and I've deliberately not looked at how that and all the other purchases have performed. Over the short term, share-price movements aren't really very important.
But that said, now that we're six shares in (I anticipate the portfolio eventually holding around ten shares), I think this is probably a reasonable time to have a quick look back and see where our companies have been going.
So let's start with a look at our holdings:
|Company||Buy price||Current bid price||% Change|
|Vodafone (LSE: VOD)||168.5p||189.4p||+12.4%|
|Tesco (LSE: TSCO)||305.5p||323.6p||+5.9%|
|GlaxoSmithKline (LSE: GSK)||1,440.5p||1502p||+4.2%|
|Persimmon (LSE: PSN)||617.9p||639p||+3.4%|
|Blinkx (LSE: BLNX)||36.9p||40.7p||+10.4%|
|BP (LSE: BP)||434.5p||450p||+3.6%|
While those price rises are nice, they don't really mean much just yet, and all it might take for a quick reversal would be, say, another eurozone panic -- and I certainly wouldn't rule out one of those. But what's happened to our companies since we bought them?
We bought Vodafone shares on May 18th, and then we received an interim update on July 20th, which didn't really please many investors.
The update showed falling revenues from most of the firm's tough European markets. But to contrast that, we saw strong growth in emerging markets, notably Turkey and India. And that's one of the nice things about buying companies that operate internationally -- we enjoy a buffer from any local economic shocks.
We also saw the completion of Vodafone's takeover of Cable & Wireless Worldwide, as expected. Overall, things are still looking fine.
Since we bought Tesco on May 23rd, we've had a first-quarter update in June that essentially said 'steady as she goes'. Group sales were up 2%, though like-for-like sales in the UK fell by 1.5%. Market share in eleven of the supermarket's twelve international markets improved, and cash flow and profits looked fine.
In the UK, Tesco is still in its turnaround drive, and it's too early to say how well that will go. But my reasons for buying the shares remain unchanged, and I'm happy with the way things are looking, as supermarket shares in general are enjoying a good spell.
We added GlaxoSmithKline to the portfolio on June 12th, and since then there has been a bit of drama involving a settlement with the US government over a product mis-selling scandal. That cost the pharmaceuticals giant a cool $3 billion! But it was already expected, and didn't harm the share price.
A second-quarter update on July 25th showed a small, but expected, fall in both revenues and profits, as the industry is suffering from a European spending squeeze and competition from generic rivals.
Nonetheless, the takeover of Human Genome Sciences for $14.25 per share, the finalisation of which was announced on August 3rd, demonstrates Glaxo's response to the changing business environment -- its acquisition plan aimed at expanding further into new biotechnologies to offset the toughening 'blockbuster' market is progressing well.
We bought video technology expert Blinkx on July 18th, at a time when I thought the shares were unfairly depressed, and though that was only a few weeks ago, we have already heard news of progress.
On August 1st, the firm announced a partnership with Kiplinger and gain the opportunity to produce targeted advertising based on the US publisher's content.
That's about it for our recap. There has been no notable news from Persimmon since we bought those shares on July 4th, and our BP purchase was only last week.
Back to ignoring share prices now, as we get back to the search for the portfolio's next addition. I have some ideas, and I'm sure you have a few, too -- please feel free to offer your suggestions in the Comments section below.
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> Alan does not own any shares mentioned in this article.