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SMDS Acquisition

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daveh
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SMDS Acquisition

#140674

Postby daveh » May 23rd, 2018, 8:32 am

DS Smith the packaging company are making another acquisition in the USofA:
http://www.investegate.co.uk/article.as ... 8959O&fe=1

DS Smith plc today announced an agreement to acquire Corrugated Container Corporation (CCC), a high-quality corrugated packaging company in North America. The acquisition follows DS Smith's recent purchase of Interstate Resources, building on the company's paper and packaging capacity in the region.


and

The acquisition is expected to be earnings enhancing immediately and is consistent with the Group's medium term financial targets.


So far they seem to have done well at integrating these bolt on acquisitions, even some quite large ones in Europe. Hopefully this success will continue in the future.

One of my better performing HYP shares, first bought in September 08 and showing an XIRR of 35% per annum including dividends. No longer high yield at ~2.7%, but good when bought and has now paid more in dividends than I paid originally, plus I let the rights issue lapse in 2012 which also returned a similar sum to the original cost of the shares.

vrdiver
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Re: SMDS Acquisition

#140681

Postby vrdiver » May 23rd, 2018, 8:54 am

Time in the market, not timing?

I bought my SMDS shares in April 2006, let the 2012 rights lapse and have enjoyed a 16% XIRR. Happy with that, but impressed with your 35%!

Whilst the dividend is no longer spectacular as a headline yield, the CAGR over 1, 5 and 10 years is 16%, 19% and 6% respectively (not adjusted for the rights - just lifted from my s/sheet) so a healthy uplift which is very acceptable. If the latest acquisition helps to continue that increase then I am happy.

VRD

daveh
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Re: SMDS Acquisition

#140686

Postby daveh » May 23rd, 2018, 9:11 am

vrdiver wrote:Time in the market, not timing?

I bought my SMDS shares in April 2006, let the 2012 rights lapse and have enjoyed a 16% XIRR. Happy with that, but impressed with your 35%!

Whilst the dividend is no longer spectacular as a headline yield, the CAGR over 1, 5 and 10 years is 16%, 19% and 6% respectively (not adjusted for the rights - just lifted from my s/sheet) so a healthy uplift which is very acceptable. If the latest acquisition helps to continue that increase then I am happy.

VRD


I may have been lucky with my timing and picked them up at a very good price, looks like the yield was some where between 5 - 6% from comparing the first full year of dividends received with the cost of the holding. They are now at ~ median holding size so no plans to sell. One of my earlier purchases so bought in a smaller holding size than I usually aim for now, but the share price gains have brought them up to my normal holding size that I aim for these days.

fisher
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Re: SMDS Acquisition

#140755

Postby fisher » May 23rd, 2018, 12:48 pm

I first bought in 2005, sold in 2007, bought again in 2008, took up rights in 2012 and bought more in 2014. Very happy so far. When I first bought them they were a boring company with a static 5% or so dividend yield. They seem to have done a good job transforming themselves over the past few years.

My XIRR is 27.92% and they are my largest value holding in my HYP at around twice the average (mean or median).

tjh290633
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Re: SMDS Acquisition

#140866

Postby tjh290633 » May 23rd, 2018, 11:02 pm

Looking at my records, I first bought SMDS in February 2007 at 210p, with a starting yield of 4.1%.

Topped up in October 2008 at 81p, trimmed in November 2010 at 189p, sold the nil-paid rights in February 2012 and trimmed again in July 2015 at 408p.

My IRR is 16.5%, while a single initial purchase, left untouched would have an IRR of 11.6%. The dividend has risen from 8.6p to the current 15.5p, having been cut back in 2009-10 to 3.4p. The share price had fallen to 48p at one stage, possibly lower.

TJH

daveh
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Re: SMDS Acquisition

#140952

Postby daveh » May 24th, 2018, 12:16 pm

tjh290633 wrote:Looking at my records, I first bought SMDS in February 2007 at 210p, with a starting yield of 4.1%.

Topped up in October 2008 at 81p, trimmed in November 2010 at 189p, sold the nil-paid rights in February 2012 and trimmed again in July 2015 at 408p.

My IRR is 16.5%, while a single initial purchase, left untouched would have an IRR of 11.6%. The dividend has risen from 8.6p to the current 15.5p, having been cut back in 2009-10 to 3.4p. The share price had fallen to 48p at one stage, possibly lower.

TJH

I made 6 small purchases in Halifax sharebuilder between September 2008 and March 2009 paying 130p, 58p, 76p, 72p, 89p and 76p per share, plus I had automatic dividend reinvestment set up so four dividend payments were reinvested in shares, which will have improved the rate of return. Dividends after May 2010 were taken as cash* and are included in the XIRR calculation as positive cash items on the relevant dates. The nil paid rights were sold in 2012.

* dividends were reinvested elsewhere within my HYP


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