Derek Pain: Procrastination can sometimes be the way to good luck
No Pain, No Gain
Saturday 21 April 2012
Investment and luck have an uncomfortably close relationship. Once again I have experienced good fortune by managing to avoid Healthcare Locums, the medical recruiter that is currently in the critical care ward. It was only a few years ago that I almost added the shares to the No Pain, No Gain portfolio. But while I dallied the price soared into the stratosphere, prompting a re-think.
I am often accused of dawdling over new investments. But for my admittedly fortuitous caution I thank my lucky stars. I would have enlisted the shares if the price had not shot ahead, making them far too expensive. Since those heady days when Healthcare Locums could, in the stock market's view, do no wrong, the group has endured a horrendous and humiliating time, suffering such wounds as accounting irregularities and huge losses. To make matters worse, executives have departed, there has been a share suspension as well as a desperate cash raising exercise. And, just to pile on the agony, litigation is on the horizon.
The shares now limp along at around 2.1p, valuing the company at £17.8m. When I was looking at them they were enjoying a spectacular run, with the group producing profits of £15.8m, followed by £17.7m and suggestions the next milestone would be £31m. Instead came a £56.5m loss and then the latest return, a £12.9m deficit. If I had descended on the shares the portfolio would have paid the equivalent of about 26p – so an enormous escape. Mind you, I might have avoided one reverse but the shares I enlisted instead have not been an outstanding success.
However, Marston's, the brewer of such traditional English ales as Pedigree and Brakspear, is at least showing a profit – if only pennies – and offers any investor who picked up the shares a yield close to 6 per cent, a splendid return in these low-interest-rate days. I continue to rate the shares – for too long sidelined by the City. The company, in a difficult climate, seems to be performing quite well and the continuing expansion of its pub/restaurant estate is benefiting profits.
Lady luck, however, is a fickle creature. I could relate various examples when the portfolio has suffered from misfortunes – or, perhaps, my misjudgments. Indeed one of the portfolio's most disastrous ventures has returned to haunt me in the shape of Green Compliance which has recently, after many tribulations, at last got round to issuing a fairly upbeat trading statement.
Readers may remember the company as Wyatt. Then it had an array of on-line services covering such areas as tax and employment.
The shares were recruited in April 2003 at 27.5p a pop. It was an unhappy investment, falling into the penny dreadful category even before the group decided on a restructuring that took it into new areas under the name of Green CO2. Now, following another revamp, it is Green Compliance and is involved in water hygiene, pest control and fire protection.
The poor share performance and subsequent share restructuring almost wiped out the portfolio's investment. In the end it escaped with a miserly £200 or so from its original £5,000 stake. If I had held on, the portfolio's coffers would have been even more depleted as the twice-consolidated shares have more than halved in the past year. The price is now 23p, capitalising the company at £8.4m.
Still, it appears that Green Compliance has at last got its act together. The chief executive, John Prowse, talks about a "solid trading outcome" for the year just ended. He is busy putting together, through a series of acquisitions, what should be a serious player in the group's three chosen activities.
After such a bruising encounter I don't think the portfolio will return to Green, even if things are looking up and it could be argued that there is every chance the shares are now wickedly undervalued.
The portfolio was out of luck on the two previous occasions it returned to past constituents. Myhome International, a franchise group, went bust, although overall, thanks to the initial involvement, the portfolio managed to escape with a reasonable profit.
Mears, the support services group, is the other re-investment. The shares are below my second-time-around buying price, yet happy memories still linger about their earlier contribution.
sportLiverpool 5 Norwich City 1: Uruguayan striker has now scored 11 league goals against the club
arts + entsOlivier-nominated actor and singer is set to star in Lloyd Webber's musical about the Profumo affair
filmWith more than 70 per cent of early films lost, archivists are scouring the world to preserve the precious examples that remain
sportThe coach of Chalfont St Peter's under-10s football team was relieved of his duties after he sent an email to parents that said: 'I am only interested in winning'
techA piece of new hi-tech kit aims to get us scribbling again
indybestMake getting out of the wrong side of bed on cold winter mornings a thing of the past with our selection of night-time covers
life + styleClarissa Baldwin is the brains behind the slogan 'A Dog is for Life not just for Christmas'
10 tips for taking out a personal loan
Banks are brought to account by switchers as growing number of people expect to be rewarded by their bank
Bargain Hunter: Playmobil plays to the gallery with discounts on its toy range
How to start your own internet business
Five ways to make money on the internet
- 1 North Korea: Kim Jong Un 'sacks powerful uncle and has his aides executed'
- 2 The hardwired difference between male and female brains could explain why men are 'better at map reading'
- 3 Is this the scariest advert ever? Japanese tyre commercial comes with its own disclaimer and health warning
- 4 A forgotten episode in Russian history leaves links with the Philippines
- 5 ‘Put it in my mouth’: Viewers outraged by apparent reference to oral sex in VIP e-cig advert
iJobs Money & Business
£Negotiable: Citifocus: The role will suit a fund product specialist, current...
£75000 - £85000 per annum + Bonus and Benefits : Harrington Starr: An award wi...
£300 - £400 per day: Harrington Starr: My client is currently looking for an e...
£300 - £400 per day: Harrington Starr: My client is currently looking for an e...
Day In a Page
A four-bedroom home with exposed brick walls and open fires in the picturesque village of Northill
A Grade II-listed property with five bedrooms and unique tower, overlooking Hastings Old Town
A charming five-bedroom detached family home, set within half an acre in Kew
A two-bedroom maisonette set on the top two floors of a period building, close to Kentish Town Tube.
Take advantage of the extra space provided by former stables and outbuildings at this five-bedroom farmhouse.
This three-bedroom Victorian terrace is near to Queen’s Road Peckham station, Nunhead station.
A five-bedroom modern house with terrace, swimming pool, Zen treehouse and large carp pond
An unexpected gem with four bedrooms, remarkable vaulted reception and a galleried study area
A five-bedroom house in one of Lymington's most sought after tree lined avenues, moments from the marinas and sailing clubs
A grand early 19th century B&B close to the historic harbour, with four en suite bedrooms
A four-bedroom, 17th century home with walled gardens, a landscaped terrace, cellar and open fires
A six-bedroom house with five bathrooms and four reception rooms spread over 4,000sq ft of luxury living space
A stunning three double-bedroom apartment with two decked terraces in the exclusive gated community, Bromyard House
A 10-bedroom period, family home amid beautiful surroundings in the centre of the Wentworth Estate in Longcross village
A stylish three-bedroom apartment with two bathrooms and private landscaped garden, moments from Fitzroy Square
A Grade II-listed Elizabethan barn with landscaped gardens, exposed elm beams and four bedrooms, all with lovely views
A six-bedroom family home, dating back to 1280 with four reception rooms, barn, swimming pool and tennis courts in Harwell
A spacious two-bedroom flat, refurbished to a very high standard with private landscaped garden, close to Kentish Town station
An exceptional two-bedroom apartment with balcony and underground parking in the centre of Richmond
A one-bedroom, luxury, duplex apartment in the grand landmark building, Imperial Hall
Run a fabulous boutique shop, live above it in a one-bedroom flat and let a second one-bedroom flat that comes part and parcel
A Grade-II listed, thatched cottage in Hundleby village, with five bedrooms, a coach house and three and a half acres
A spacious two-bedroom flat in the heart of Hoxton Square with wooden floors and roof terrace
A five-bedroom family home with stunning pool and gym complex set among two acres of land
A six-bedroom period house with heated swimming pool and a separate two-bedroom annexe cottage in Townlake, £795,000
A spacious and contemporary two-bedroom flat arranged over three floors, with garden patio close to St George Square, £600,000
A one-bedroom flat in a beautiful Regency building opposite the beach in Kemp Town, £190,000
A two-bedroom flat with London skyline views close to Surrey Quays. £395,000.
A seven-storey tower with three bedrooms and a stunning roof terrace. Guide price: £850,000.
A 16-bedroom country pile with nine reception rooms, four self-contained flats and a 13th century Peel Tower. £850,000.
A classic six-bedroom Victorian Manse house 10 miles from Edinburgh. £495,000.
John Lennon's childhood home in Liverpool to be sold at auction. Guide price: £150,000-£250,000.
A six-bedroom detached period property with secluded gardens, ample parking and a double garage in Rye, £675,000.
A large split-level property with three double-bedrooms and roof terrace, close to Crouch End Broadway, £625,000.
A charming barn conversion in the picturesque Cotswold village of Ilmington with three bedrooms, a detached garage, workshop and beautifully manicured gardens £675,000.
A three-bedroom new build, ground-floor flat with two bathrooms, close to Bermondsey tube, £445,000.
A three-bedroom house in an enviable new development moments from Oxshott High Street, with secluded garden and decked area, £385,000
A two-bedroom split-level flat with stunning south-west facing roof terrace in the popular Brondesbury Conservation Area, £549,950.
A charming 16th century, three-bedroom detached house in Bidborough with picturesque garden
A top-floor one-bedroom flat in the heart of Pimlico with a terrace providing spectacular views over London, £495,000.
A six-bedroom house, with three reception rooms, 1.5 acres of land and stables, £450,000.