It’s the last quarter of the year! While Covid-19 is still going to be around for some time, businesses are adapting to it and there is a sense of recovery. The team has performed really well despite the pandemic. Stable defence and midfield with both fullbacks in good form. At the front, IFAST leads the attack with a menace, and with its scintillating form, SHOP takes over ANET. At about 80% fitness, FCT and MCT are back on the bench to replace CRCT and SGX.
First team made up 70% of my portfolio which is 4% higher than the previous quarter. This is attributed to the strong performance from IFAST, Micro-Mechanics and Parkwaylife.
Parkwaylife continues its stable performance with its revenue up by 0.8% and net profit income up by 2.0%. A pleasant surprise with its DI and DPU up by 7.4% to 3.54 cents. Its share price has continued to move northwards since mid-September after its inclusion in the FTSE EPRA NAREIT Global Developed Index. If it can maintain its current dividend, the yield would be about 3.5% at its current price of $4.10.
Like Virgil Van Dijk, its composure stabilizes the team. But what if he gets injured? Currently, no one can replace him directly but the rest of the CBs should be able to cover him in short term.
The slide above shows the key highlights of Ascendas Reit Q3 update. The positives are the slight increase in portfolio occupancy and lower leverage and of course the negative is the drop in rental reversion. I am confident it can maintain its 1H dividend of 7.27 cents and that will give it a current yield of 4.6%.
Not super excited by its current prospect, so I am just going to hold on to my current stake.
Micro-Mechanics reported another record quarter, with revenue up by 18.3%, net profit up by 43.2% and free cash flow up by a whooping 81.8%.
As seen from the above tables, this is the best quarter over the past year and bearing unforeseen circumstances, this should continue for the rest of the year. I also came away from the recent AGM feeling positive and am confident that the company is able to at least maintain its dividend for this financial year.
Currently occupying 7.5% of my portfolio and almost reaching my CPF stock investment limit, I will just continue to hold on to my current stake.
Venture continues to improve its quarterly performance as show in the figure below.
Management is confident of the continued improvement in coming quarters with new products/solutions to be introduced in the next financial year. About a 10% increase in its net cash position even after its interim dividend gives me confident that it will be able to at least maintain its final dividend.
Might add a bit more when opportunity arises.
As expected, FCT and MCT both reported lower number as compared to last year. What is encouraging is the quarterly improvement with statistic that show sales are returning to pre-covid level for FCT.
Also, I perceived that the management is slightly more optimistic relatively to the beginning of the year, hence releases part of the withhold distribution.
While both are not completely out of the wood yet, they are showing signs of recovery and things should look better in the coming years. Hence, I added a bit more on both counters recently.
Mapletree Industrial Trust reported a stable quarter. Without withholding any cash this quarter, DPU is same as previous year at previous year. Similar to the Parkwaylife Reit, I have absolute confident in this fantastic defensive midfielder.
Will continue to hold on to current stake to participate in its transformation.
Despite the absence of a new iPhone for this quarter, Apple announced a comparable set of results with record earning from Mac, iPad, wearable and its services.
Yet its share price was punished for its lower iPhone sales. In the conference call, it was shared that the launch of iPhone 12 was delayed and current order numbers look positive. I am expecting that it will have a record Q1 next year.
Trimmed recently at US$119, I decided to add some back again at US$109 for its continual growth of services and wearable.
DBS reported a stable quarter. Key negative is the drop in its NIM of 6% but offset by an increase in fees income of 17% QoQ. It continue to increase in its provision to 1.5 billion ytd. Without which, the group would have reported a net profit growth. CEO guided a lower allowance for the next financial year.
No change in my stance. Will continue to hold on to this strong bank and wait for it to give out more dividend once the storm is over.
SBUX reported a lower Q4 revenue and net profit but the drop has narrowed. They provided a guidance of 20% to 30% growth in various metrics for 2021. With less allowance set aside for this quarter, OCBC reported a net profit growth of 41% QoQ and a drop of just 12% YoY. It benefitted from a strong contribution by GEH’s profit.
While things look brighter for SBUX in the coming year, I decided to trim my holdings to raise cash to buy more Apple and Shopify which I believe to have a better growth prospect. As for OCBC, I will just continue to hold my current stake for its future dividend.
What can I say about IFAST? I was expecting a smaller growth in second half but it just blows my expectation with a net revenue up by 35.7% and net profit a whopping 150%! What a beast and its earning is expected to be more than triple by end of this year over a 4-yr period! That’s the strength of its scalable business model.
Having said the above, don’t expect a linear growth and there will be years where return will be flat or even drop. However, if the management executes their strategies right, the growth will come eventually.
Recently sold a bit to restore cash portion. Definitely not the correct decision. Will hold on to my remaining stakes tightly.
Shopify announced another burning quarter with its revenue up by 96% and Gross Merchandise Volume up by 109%. Monthly recurring revenue continues to grow with more merchants becoming paid subscribers.
With its innovating products and expansion into various aspects of on-line shopping, it is becoming a “go-to” platform for not only entrepreneurs but also big brands who want an on-line presence.
With the share price corrected about 20% from its recent high, I decided to accumulate more as it has great growth prospect for many years to come.
While revenue and net profit are still down, Intuitive Surgical reported a 7% increase in its da Vinci procedures for this quarter. While it’s still early to say things will be back to the norm, the pend up demand for the procedures should results in better numbers in the coming year.
Just going to hold on to my current stake.
Arista Networks continues to have weaker revenue and net profit compared to last year but q-o-q, things are improving. The growth should be back soon. Surprisingly, the market takes to its latest results very positively and its share price went up by 20% after releasing the resutls. Ulta will only report its latest quarter in early December. I expect it to report lower numbers y-o-y but improvement q-o-q.
After trimming both counters in October, I have no intention to buy or sell at the moment.