In the previous post, I wrote about overall performance for this year and which strategies have gone well for me and how I can do better. As mentioned, one reason for the strong performance this year can be attributed by the over performance of a few counters. The tables below summarise the top gainers and losers for the year.
As per last year, Best World is the winner this year. However, unlike last year where only Best World stood out, this year big winners included other counters such as Valuetronics, Food Empire, Micro-Mechanics and ParkwayLife Reit.
I am also pleased that 6 out of the 11 current core holdings have returned at least 10% this year.
Core Holdings Performance
Core holdings are counters which I am more familiar with. These are counters which I am more confident of and have a more substantial holding (at least 5% of portfolio); hence I am more likely to hold them for a longer period of time.
The core holdings made up about 35% of the portfolio but they account for 66% of the cost. The current average holding period is about 1.9 years, as compared to 0.1 year for the remaining holding.
- Food Empire (8.0%) @ $0.46
This tranche was first purchased in March 2014. Along the way, I have added and reduced my holdings. However, since November 2016, I have increased my holding for another 5 occasions. The last purchase was in July this year at a price of $0.665. For the year, it has returned about 30%. Based on average price, the return (including dividend) stands at 48%. Going forward, growth will probably be lower than the current year of 50%. World Cup at Russia might give it a booster shot though.At the current price of $0.675, forward PE is around 12 which is definitely not expensive. With the strong performance, I believe the dividend declared will also be higher next year. I am holding on to my current stake and am unlikely to add unless there is new growth catalyst or price drops to $0.57 with no change in fundamentals.
- Raffles Medical Group (7.4%) @ $1.41
First purchase was May 2016 and have been adding throughout that year as I bought in to the expansion story. Still believe in the story but have probably added too much in 2016. Last purchase was in August at $1.17. The plunge in price since August 2017 has resulted in a loss of about 18% for the year and 20% based on average price.Is it time to buy or sell? It really depends on how the expansion plan works out in the next 2 years. Well executed, $1.1 will really be a good catch. On the other hand, if the expansion plan doesn’t work out, expect further pressure on the price. For me, I think it will work out well, so am holding on to what I have and may add more if price drops below $1.
- Straco (7.3%) @ $0.85
First purchase was in September 2015 and have added more on numerous occasions. Last purchase at $0.87 in September. For the year, it has returned about 10%. Based on average price, the return (including dividend) stands at 5%.
I treat Straco as a dividend counter though based on current price of $0.85, the yield is only 2.9%. The company has continue to show it is able to generate good cash and I believe it is only a matter of time (this year or next) that it will increase its dividend. And I am hopeful that it will continue to return the excess cash in future if it has no use of it.Not adding more at the moment until further clarity of how it is going to utilise its cash pile.
- Frasers Centrepoint Trust (6.6%) at $2.06
First vested in June 2016. Added on numerous occasions since then and last purchase was in October at $2.17. For the year, it has returned about 18%. Based on average price, the return stands at 14%.FCT is a steady managed REIT which increases its DPU for 11 years consecutively. And that despite major AEI in 2017 for Northpoint. So how did it do that? From what I gathered, the management decided to receive a larger part of its payment by unit in 2017, resulting in a slightly higher DPU. With AEI completed, next year should see 12th year of consecutive increase in DPU.Not adding more at the moment as I do have quite an exposure to retail REIT.
- ParkwayLife REIT (6.0%) at $2.32
Another quality REIT which I first purchased in September 2015. Added on numerous occasions in 2015 and 2016. Last action was a reduction in November 2016 at $2.51. For the year, it has returned about 32%. Based on average price, the return stands at 40%.
The price has ballooned above $3 in recent time. Thought of selling it does surface a couple of time. However, after considering the track record of the management and the favourable rental reversion that the REIT enjoyed, decide to continue to hold on to it for the moment. Will re-consider sell decision when yield dropped below 4%.
Definitely not adding at the current price.
- Valuetronics (5.8%) at $0.54
First purchase in June 2016. Added on numerous occasions since then and last purchase was in June at $0.77. Riding on the electronics boom, it has returned about 77% this year. Based on average price, the return stands at 81%. At the current price of $0.91, PE for 2017 is probably around 11. It is on the high side compared to the past few years. But hey, the last two years earning is growing at about 25% and it should continue to do well for first half next year. If there is no change in its dividend for year end, the current yield is about 5.1%.Have no intention to divest it at the moment and may add more if price dropped to around $0.80.
- UMS (5.1%) at $0.94
A recent purchase in August. Year-to-date return is about 9%. Nothing much to add on from what I have written on the counter in the following two posts:
– A look at my recent buys (Part 2) Hock Lian Seng vs UMS
– Buy and sell actions in November
- iFAST (5.0%) at $0.94
Another recent purchase in September. Year-to-date return is about -5%. I deemed the counter as fairly priced for my expectation of its growth rate at around 25% – 30%. Read the post “A closer look at my recent buys (Part 1) iFAST” for my opinion on the counter.
- 800 Super (5.0%) at $1.16
I first purchased the counter last December at around $0.93. That tranche was divested in April at $1.26 for a return of 35%.With the dropped in price in August, I have re-entered and adding more in two other occasions in September and October after reading up more about the company. Return for the current tranche stands at 1.0%. You can read my view on the company in this post “A look at my recent buys (Part 3) 800 Super”.
- VICOM (4.9%) at $5.75
VICOM was another recent purchase in August and September. Return so far stands at 1.0%. Read my reason for purchase in this post “Why I buy VICOM Ltd”.
- Starhill Global REIT (4.5%) at $0.70
Besides First REIT and Metro which I had for a decade in my CPF Portfolio, I have held Starhill Global REIT for the longest period. I have kept my original holding bought in 2012 until last year’s reduction due to allocating fund to purchase FCT. I have added a bit back in August and September as I believe that results will improve in the next few years. The REIT has returned 10% this year and total return (including realised gain from divested) stands at 85.2%.Unlikely to add more due to substantial exposure to retail reit and it would likely fall out of the core holding by end of next year.
It has been a good year for many counters especially those in the electronics and semi-conductor sectors. Most of the above counters should continue to do well next year (I certainly hope so). And with improved earning, hopefully the price and dividend can continue to increase!