It’s been a mixed month for my Stocks and Shares ISA. Most of my investments have been roughly in line with the FTSE 100 and the S&P 500, but a couple have stood out – good and bad.
The top performer in my portfolio has been Rentokil (LSE:RTO) which climbed 14%, but the weakest was Chord Energy (NASDAQ:CHRD) which fell 11%. So what should I do about this?
Rentokil
The main catalyst for the big move in Rentokil shares was its Q3 trading update near the end of the month. Group revenues for Q3 were up 4.6% and organic sales increased 3.4%.
On the face of it, that’s not massively exciting. But both numbers are a big improvement on the 3.1% and 1.4% the firm reported at the end of Q2.
Rentokil made a huge acquisition in 2022 and the subsequent integration process seems to be taking forever. And I continue to see this as the biggest ongoing risk for the company.
On balance, though, I think there’s more growth to come from the business. And I still feel the stock looks cheap, though it’s not top of my list in November.
Chord Energy
There’s a very simple reason shares in Chord Energy fell in October. Oil prices fell below $60/bbl and that’s not a good sign for a company that produces and sells the stuff.
The risk is that this continues. But I think the current downturn in oil prices might be a chance to add to my investment while the short-term outlook is less favourable.
Chord has a clear decade’s worth of production ahead of it. And if – as I’m expecting – oil prices move higher over the long term, investors could stand to do very well.
The firm has a big focus on returning cash to investors via dividends and share buybacks. This can exaggerate the natural cyclicality of oil stocks, but I see the downturn as an opportunity.
Next moves
Chord is one stock I’ve got an eye on in November, but it isn’t the only one. I’m looking at shares in the UK and the US that are high-quality companies at unusually cheap prices.
In the UK, Judges Scentific is one name on my radar. The company is working through a difficult trading environment right now, but I like its long-term growth prospects.
I’m also considering US tractor manufacturer CNH Industrial as an addition. I don’t know when crop prices that have caused sales to falter are going to recover, but I think the stock looks cheap at $10.50.
Those are two of the names I’m considering at the moment. But like any good investor, I’ll also be keeping an eye open for other opportunities that might present themselves.
Long-term investing
It’s always good to pay attention to what’s going on in my Stocks and Shares ISA. But what happens in any given month ultimately doesn’t matter much for a long-term investor like me.
With Rentokil, it’s important that its integration keeps moving in the right direction. Progress might not be linear, but as long as it gets there sooner or later, I expect to do well.
Short-term oil fluctuations might make Chord’s share price go up one month and down the next. Over time, though, what matters most is the firm’s ability to keep producing.
