fredag, december 07, 2018

SAAB's new stock issue is more expensive than the stock!

Rights to buy the new SAAB shares are going for 30kr now and you need 4 of them to buy a share, which will then cost 225kr. But if you are a current owner, you have these rights already. So if you sold 4 of them, you would earn 120kr, which you can then use to buy a share on the market which currently costs 340kr. Minus your earnings from your rights (340kr - 120kr), each share would cost you just 220kr. A 5kr discount per share. This doesn't make much sense for current owners.

Usually the stock price stabilises around the new emission price. I have to say SAAB shares have performed very suspiciously ever since the TX win. First it didn't go up an awful lot as one might expect, it then collapsed by a ridiculous amount after the new issue announcement, and now it is still in decline? This stock is behaving very suspiciously. One unknown that we do not know since the TX win is exactly SAAB's share of the deal and how much profit they expect to make. This may be what the smart money knows that we do not know and why SAAB AB share price is not performing very well.

I have sold half my TR's already and considering what to do with the rest.

onsdag, november 21, 2018

Starbreeze gaming publisher has been a terrible stock to own. From almost 25kr (around 2.5 USD / Euros) in 2016 to a low of 3.4 kr yesterday. It's now up to 4kr today and I hope this was the bottom. I've been buying since 2016 all the way down to 3.75 and my position is 73% in the red.

A good article to summarise the details is here (Swedish). Earnings have fallen 56% and their latest game "Overkill's the Walking Dead" has been a flop. Their one successful game, Dead by Daylight, they sold off the publishing rights. So there is concern that they have made costly investments in games and it is not paying off.

I actually don't think the "Walking Dead" is a bad game, and believe, once the dust has settled it will gradually be a steady money maker for Starbreeze. They also have other games in the pipe that could pay off. But they haven't shown a track record for success and this is a bit into the future. I also know Starbreeze stock holders are a younger, fickle bunch. The stock has really been a roller coaster through the years.

I will have to wait until concrete sales numbers come in, but I am betting that Starbreeze is way over sold and if you are in the gaming industry, an investor has to expect some flops (Bethesda Fallout 76?). I expect the stock to recover to around 10kr in the next 6 months.

onsdag, oktober 24, 2018

SAAB AB just collapsed by 16% in two days. This is due to the news that SAAB will be issuing a new emission of stocks which will bring in 6 billion kronor and dilute the current stockholders by a similar amount. Nordea has reduced its anticipated price for SAAB from 500kr to 450kr. It is currently at 350kr.

SAAB apparently needs a lot of new money for growth. It is reported this is not due to winning the T-X competition, as stated in this article: SKOLFLYGPLAN. I don't believe that for a second. Of course it is because of that and understandably so. In the same article it is also implied that simply taking a conventional loan is insufficient for their needs. I also don't believe that either. With current interest rates still very low, it would be wise to increase company debt.

What I do believe is that Investor and the Wallenberg family which own almost 50% of SAAB together want to buy shares at a cheaper price. SAAB is a becoming a much larger company and more shares circulating would befit it.

Saddened that I had bought a lot more shares before this collapse. I was caught off guard by this manoeuvre but nonetheless bought more shares yesterday. I think you should too.

söndag, september 30, 2018

Boeing / SAAB T-X

Boeing / SAAB team has been selected as winners of the US Air Force T-X competition. While important for Boeing, it is more so for SAAB, putting SAAB with the big boys in military aircraft manufacturing.

SAAB AB has already gone up by 8.5% since the win. Before this, SAAB was actually in decline, seeming in anticipation of a loss. Last year, SAAB traded to a high of 453kr, it closed on Friday at 447kr. It has a dividend of 1.3% and a P/E of 37. Despite its high P/E, I believe SAAB has a lot more to gain.

The Swedish Air Force is also in need of new trainers, and will probably buy this one.

Investor AB is an investment company which owns 30% of SAAB AB. While the stock is a small portion of its portfolio (3%), it has a dividend yield of 2.8% and a P/E of 14.8 and could be an alternative to investing directly in SAAB.

I have doubled my initial position and will probably triple it next week.

tisdag, juli 10, 2018

Purchased AT&T

Last week I bought a few shares of AT&T @ 32.74, today it is at 31.15 USD, bringing me up to 140 shares. At these prices, AT&T enjoys a dividend of over 6%.

I was a little on the fence on this purchase since I already own AT&T (bought also around this current price) and the stock has gone nowhere for years, despite a short spike to 41USD a couple of years ago. But AT&T is moving in a new direction, the question is can it compete with Netflx?

The deciding factor for me in approving of AT&Ts new direction is that it 's vertical monopoly strategy, the quality of the companies it bought, and it's only con, it's a heavy debt load.

As most know, AT&T bought Time Warner recently, and even more recently, AppNexus; a tech company for advertising. AT&T is already a near monopoly in the markets it operates in, now it is becoming a vertical monopoly, integrating itself in the entertainment content distribution market. It is not really an area of competence for AT&T management, but it has bought that competence through the companies.

Good luck AT&T!

And this just in; today AT&T purchased AlienVault, an enterprise level IT security company. At least they thought this through.

torsdag, augusti 27, 2015

Bought 25 shares of RDS.B today, at 49.92 USD. Not a personal buy, but for my mother, because I am mostly out of investing money myself.

Shell yields 7.56% and is an incredible bargain. The only concern with Shell is that it may not be able to maintain the dividend. This is because of the high cost of the BG purchase, and falling oil prices. I simply don't agree that the risk is so high that Shell will resort to cutting its dividend. As far as I can research, Shell last cut its dividend in 1945. So I think Shell has gone through worse than currently depressed oil prices.

The reason I prefer to buy Shell rather than, say, Exxon is, 1, it yields much more (XOM yields 4%), 2, the strong dollar is not condusive to purchase of US stocks at the moment and 3, Shell has no taxes on its dividends. That is, RDS.B payouts are not taxed, RDS.A are. Taxes can be deducted from personal taxes, what happens if you don't have any local taxes to deduct from? As you might have in an ISK?